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Crater Lake Motors, Butler Ford buy four Lithia franchises

Crater Lake Motors of Medford and Butler Ford of Ashland have purchased four local auto franchises from Lithia Motors. The deals have been in the works for more than a year and were closed this month.

Lithia Motors had brands that no longer fit with its local mix of dealerships, while Crater Lake Motors and Butler Ford were both happy to extend their lines.

Crater Lake Motors bought the Lincoln, Mercury and Mazda franchises for its 2611 Biddle Road location, while Butler acquired the Suzuki line for its 1977 Highway 99N site.

Lithia had the Lincoln Mercury franchise for 25 years and bought the Mazda franchise from Paul Phillips 12 years ago.

— We needed more space for our corporate headquarters and the franchises didn't produce a great volume, said Dick Heimann, Lithia's president and chief operating officer. If it was our choice, we would've put Lincoln and Mercury with Dodge because it's a domestic brand and would've put Mazda across the street from Nissan and Suzuki in with Volkswagen. But those manufacturers wouldn't allow us to do that.

Lithia sold about 10 Lincoln and Mercury vehicles a month before the market slowed and recently was turning over four units a month. It sold one or two Suzukis a month, but 20 monthly Mazda sales were much stronger than the dozen expected for a market this size.

Crater Lake Motors owner Jim Coleman said the acquisition fills some gaps in his store's offerings to domestic and import buyers.

This gives us a full-price range from &

36;10,000 to &

36;100,000 in an import vehicle with Mazda and Mercedes Benz and from &

36;10,000 to &

36;60,000 with Ford, Lincoln and Mercury, Coleman said.

The deals needed the blessings of the manufacturers and required market studies, business plans and customer service checks.

For a long time, Ford wanted Lincoln and Mercury at separate sites, Coleman said. That continues in larger markets right now. You wouldn't see a Ford Lincoln-Mercury (dealership) right now in Eugene or Portland.

The transaction also figures to spur sales. Crater Lake Motors sold 2,100 new and used cars in 2000 and saw sales fall to 1,750 in 2002.

This gives us a one-stop shopping situation, Coleman said. It creates efficiencies because we have the same parts and service people and all we'll have to do is pick up one or two technicians.

Lithia on the other hand, had to pay for a general manager, sales manager, service manager and parts manager for the dealership at its corporate office.

No matter if we sold a few more cars and made a little money, Heimann said, all the time, capital and energy tied up was not the best we could do for our investors.

No Lithia employees lost their jobs as a result of the sale, although the Suzuki parts manager will go to work for Butler. Butler services all the vehicles it sells at its Medford and Ashland service centers.

Reach reporter Greg Stiles at 776-4463 or e-mail