For more than 50 years, Sheppard Motors has been a staple business in the Eugene community. But come June 9, it may lose its Chrysler franchise and face financial problems.
On May 14, Chrysler told about a quarter of its dealers they would be eliminated by June 9. The carmaker sent letters to 789 of its 3,200 dealers, revoking their franchises. Chrysler said the “rejected dealers” accounted for 14 percent of its overall sales volume, and half of them sell fewer than 100 vehicles a year. However, dealership co-owner Phil Speers said Sheppard Motors saw its most profitable years in the past two years, causing confusion over his franchise’s revocation.
“I am in shock for whatever reason President Obama’s car task force thinks it’s okay to eliminate over 40,000 jobs right now. There has been no due process or rule of law here,” Speers said. “It has been very disappointing and confusing to someone who supports what (Obama) is trying to do.”
In 1959 Harry Sheppard emigrated from Canada and began the business. In the 1970s his son, John, inherited the company. In 2000, Phil Speers took over the wheel with John Sheppard.
“We have been greatly involved with Eugene over the years,” Speers said. “We have hired students and residents of Eugene, contributed to the Relief Nursery, Boy Scouts and the Eugene Downtown Rotary.”
As a good friend and fellow Rotarian with John Sheppard, University President Dave Frohnmayer has seen the contributions Sheppard Motors has given to the community.
“John is an exemplary Eugene citizen. He is always one of the first people to step up and engage in Rotary enterprises and other community endeavors,” Frohnmayer told the Emerald. “He also gives away a free Jeep every year at the Great Rotary Duck Race.”
In March, Obama ordered Chrysler – once America’s third-biggest automaker – to complete a planned partnership with the Italian carmaker Fiat within 30 days or face bankruptcy, after Obama’s car task force concluded Chrysler could not survive as a stand-alone company. Days before the April 30 deadline, last-minute negotiations with smaller bondholders failed, leading to the bankruptcy announcement. Fourteen days later, managers and owners such as Speers received the Chrysler letter. Sales associate Brian Palmer was surprised to hear the news.
“I just shook my head. I didn’t see it coming, but I wasn’t shocked,” Palmer said. “(The decision) is out of our hands. It’s being done to us, but we are hoping it might not happen in the end.”
Frohnmayer said he was also shocked upon hearing the news.
“I’m disappointed it has had an impact on this community, and on such long-standing pillars of the Eugene community,” Frohnmayer said.
Both Speers and Palmer are confident, however, that the final decision will not be fatal to the dealership.
“We will be working on replacing the Jeeps with another brand, and have multiple franchises to ramp up used car inventory,” Palmer said. “We will make it work.”
Speers added, “We will continue to sell and service Jeeps until told otherwise. We haven’t had to lay anyone off yet, and we don’t plan to.”
In an open letter posted on his Web site to the Obama administration’s car czar Steve Rattner, Democratic Congressman Peter DeFazio implored the administration to reconsider closing Chrysler dealerships, writing that “these disastrous actions will drive up unemployment and add to the challenges of pulling the U.S. out of a recession.”
“The administration should reverse course, stop bailing out Wall Street, and start investing in the American worker,” DeFazio wrote.
Until then, Speers said he and the 70 employees at Sheppard Motors will “keep doing what we do.”
“This has been, and will continue to be, a family business, deeply rooted in the community,” Speers said.
ahelland@dailyemerald.com