Chrysler LLC plans to shutter 789 dealers by June 9, representing 14 percent of sales volume, as part of its ongoing restructuring effort. The closings will eliminate about 38,000 jobs and 25 percent of the carmaker’s dealer network.

According to a memo circulated to dealers, as reported by the Automotive News, Chrysler says affected dealers have 23 business days for a court review of their cases and bankruptcy law protects the company from having to buy back vehicles, tools, or parts. Chrysler says it will work with dealers to sell their inventory to dealers unaffected by the announcement.

"It is with a deep sense of sadness that we must take steps to end some of our Sales and Service Dealer Agreements,” said Steven Landry, Executive Vice President, North American Sales and Marketing, Global Service and Parts, in a released statement. “The decision, though difficult, was based on a data-driven matrix that assessed a number of key metrics.

Letters will go out to approximately four million vehicle owners affected by the closings to explain the situation.

Company officials said they could not comment on specifics of the closings until documents are filed in bankruptcy court, and that all information in the memo is subject to change.

If you own a Chrysler or are thinking of buying one, and are concerned about your local dealership closing, check out our advice for what to do if your dealer closes.

We will continue to monitor this fast-moving story, reporting here in the Cars blog and also updating advice and news on the Auto Crisis hub.

—Jim Travers