Sept. 29 (Bloomberg) -- Bill Heard Enterprises Inc., the largest U.S. Chevrolet auto dealership, sought bankruptcy protection, citing a declining automobile market after it closed 14 showrooms and eliminated more than 3,200 jobs last week.

The Columbus, Georgia-based company listed both debt and assets of $500 million to $1 billion in the Chapter 11 filing yesterday in U.S. Bankruptcy Court in Decatur, Alabama. Affiliate Bill Heard Chevrolet Inc. also sought protection, listing assets and debts of less than $50 million. At least 23 affiliates also filed.

``The difficult financing conditions the automobile industry as a whole has faced because of the subprime lending industry collapse'' contributed to the closing, the company said on its Web site.

The U.S. auto market, hurt by higher fuel costs and a housing slump, is headed to the lowest annual total since the early 1990s. The failure of Lehman Brothers Holdings Inc. and other financial institutions led to tightening credit markets, sapping demand as consumers avoid buying expensive goods.

The Heard Group becomes at least the eighth U.S. car dealer to seek bankruptcy protection this year, according to court filings. The auto dealer plans to borrow as much as $6.7 million from GMAC LLC to help fund an orderly liquidation, according to court papers. Heard said it owes a total of about $229 million to lenders including GMAC, BMW Financial Services NA and JPMorgan Chase Bank NA.

GMAC Loans

The three so-called floor-plan lenders financed the purchase of automobiles at Heard's 14 dealerships. A floor plan lender covers inventory and advances monies against a specific piece of inventory. GMAC provides the floor plan at 10 Heard dealerships, according to court papers.

Johnston Shield Inc., which operated a Mitsubishi dealership in Tucson, Arizona, and other two other dealerships in the state, sought Chapter 11 protection in April listing more than $7 million in debt. Company officials said the filing was ``due to the downward turn in the economy,'' according to the Sierra Vista Herald newspaper.

Dave Croft Motors, a Collinsville, Illinois, Chrysler dealership, filed for bankruptcy on Sept. 17. Crawford D. Croft, who founded the dealership in 1976, said he decided to file for bankruptcy after Chrysler sought more money from the dealership.

Trade publication Automotive News described Bill Heard as the largest Chevrolet dealer in the U.S. for Detroit-based General Motors Corp. and the 13th-largest dealership group in the country by volume. The group sold 25,000 to 30,000 new vehicles a year, according to the publication.

Cadillac, Saab

Bill Heard operated stores in Alabama, Florida, Nevada, Tennessee and Texas as well as Georgia, selling GM's Chevrolet, Cadillac and Saab brands, according to its Web site. The company said a few employees will remain to assist in the closing.

The 40 largest creditors without collateral backing their claims are owed a total of $7.1 million, court papers show. The company listed its largest unsecured creditors as Frost National Bank, owed $1 million plus accrued interest; Nevada Department of Taxation, owed $970,972 for estimated sales tax; and Texas Comptroller of Public Accounts, owed $911,026 for estimated sales tax. Heard said it has consolidated unsecured debt of about $40 million.

Derek Meek, attorney for Bill Heard Chevrolet, didn't immediately respond to an e-mail seeking comment.

The case is In re Bill Heard Enterprises, 08-83029, U.S. Bankruptcy Court, Northern District of Alabama (Decatur).

To contact the reporter on this story: Dawn McCarty in Wilmington, Delaware, at dmccarty@bloomberg.net.

Last Updated: September 29, 2008 14:27 EDT