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Lithia buys Crater Lake Ford

Lithia Motors has reached far and wide in expanding its automotive sales empire.

Now, the nation's fourth-largest auto retailer has snapped up something closer to home: Crater Lake Ford and Crater Lake Mazda on Biddle Road.

Compared with some of Lithia's mega deals in recent years, this one wasn't much. CEO Bryan DeBoer admits the buy was pretty much an afterthought while he pursued the Downtown Los Angeles Auto Group purchase that closed in August and was worth hundreds of millions of dollars. Lithia assumed control of the Crater Lake dealerships from Menholt Auto Group of Billings, Montana, in November with little fanfare.

"We don't look at it as a big thing," DeBoer said. "It's a staple part of our diet. The name is the same and the people are the same. They're now just part of our team."

Mike Frame remains general manager, along with his leadership team.

"We'll have very little influence over the store," DeBoer said.

The Crater Lake dealerships produce about $75 million in revenue, he said.

Jackson County property records show Lithia paid $11.5 million for the dealership buildings and 8.85 acres straddling Hilton Road in north Medford. While the overall purchase price was greater, it paled in comparison to some of Lithia's recent deals. In 2014, Lithia paid $364 million in cash for DCH, which had 27 stores in New York, New Jersey and Southern California. In September 2016, Lithia purchased nine stores from Carbone Auto Group in upstate New York. Then in May, the company paid $90.2 million, including $88.1 million cash, for Baierl Auto Group in the Pittsburgh area.

Discussing third-quarter earnings in October, DeBoer said Lithia had picked up 15 dealerships able to generate $1.5 billion revenue so far in 2017.

DeBoer said nonprofit board connections got the ball rolling on the Crater Lake Ford purchase earlier this year.

"We run things similarly, focusing on creating a customer for life," DeBoer said. "We decided we may be better together than apart."

Ultimately, the Menholt Auto Group decided its future lay to the east.

"Medford is really out of our market," said Randy Point, Menholt's vice president. "We had a great 11 years in Medford, it's a great community with great people, but we wanted to reallocate our assets to where we could grow."

In the immediate future that will be Rapid City, South Dakota, where the chain is acquiring two dealerships to go with one it already owns.

"We wanted to create bigger platforms and there was nowhere to grow in Medford," Point said. "And Lithia is not what you would call a seller."

The Coleman family moved Crater Lake Motors from downtown Medford to 2611 Biddle Road in 1985 before selling in 2006. In 2011, Crater Lake Ford went through a $1.5 million makeover. The Mazda showroom was built just before the Colemans sold.

In an odd twist of history, Lithia Motors, rather than building a standalone dealership for its Mazda franchise, sold it to Coleman in May 2003.

— Reach reporter Greg Stiles at 541-776-4463 or business@mailtribune.com. Follow him on Twitter at www.twitter.com/GregMTBusiness or www.facebook.com/greg.stiles.31. Listen to his podcast at mailtribune.com/podcast.

Crater Lake Ford and Mazda dealerships in north Medford are now part of Lithia Motors. [Mail Tribune / Andy Atkinson]