Lithia Motors executive fired over falling-out

Lithia Motors executive fired over falling-out

A top corporate manager at Lithia Motors has been fired in what was described as a culture clash during a rough spot in Lithia's otherwise successful run as a publicly traded operation.

Don Jones Jr., senior vice president of retail operations, was fired over the weekend after an apparent falling-out with one or more members of the DeBoer family, which holds controlling interest in the Medford-based auto retailer.

Jones confirmed his dismissal on Tuesday, although his termination date appears unclear.

"Right now, I'm just trying to relax," Jones said. "I still have a couple of days left, but as far as the direction and vision of the company and how it might look after that, I'm not sure. I do want people to know I wouldn't trade (the time) and experiences I've had here for anything. I can't tell you how much I've enjoyed the people and what we did together."

Jones is the highest-ranking member of the auto retailer's management team to depart the company since it became publicly traded in 1997. He started with Lithia as general sales manager of Lithia Dodge in Medford. Promoted to general manager in 1991, he opened Lithia's first dealership outside of Medford, Lithia's Grants Pass Auto Center. By 1996, Jones was executive manager at all of Lithia's Chrysler dealerships. In 1997 and early 1998, he served as regional Manager for south central Oregon and the Bay Area of California. Shortly thereafter, he was appointed vice president of all of Lithia's dealership operations and in March of 2000 he attained the senior vice president role.

Lithia Chairman and Chief Executive Officer Sid DeBoer declined comment on Tuesday, citing Securities and Exchange Commission requirements concerning the departure of company officers and top executives.

"I'm not going to comment on employee issues," DeBoer said.

Jones was part of a management group that propelled Lithia from a handful of Rogue Valley stores to publicly traded firm with revenue of more than $3 billion with 110 stores in 46 markets in 15 states. During 2006, the most recent year data is available, Jones' base salary was $560,000 and he received another $396,300 in long-term compensation.

An SEC filing is required within 72 hours of termination.

Former Lithia employees characterized Jones' demise as a clash of cultures.

Jones, a tough-minded traditionalist who oversaw Lithia's managers at more than 100 retail stores, was pitted against a new operating model championed by President and Chief Operating Officer Bryan DeBoer.

Don Thompson, a former Lithia general manager in Fort Collins, Colo., and now at Jet Chevrolet in Federal Way, Wash., said Jones stifled talented general managers by keeping them on short leashes.

"He was not a car guy and he was managing car guys with a lot of experience," said Thompson, who worked for Lithia from 2003 to 2005. "GMs weren't allowed to hire people and run their stores. Their hands were tied, so to speak. If you do anything outside their process (they) would get all wigged-out. Never in my whole life was I so constrained and conflicted."

Jones oversaw anyone who managed day-to-day dealership activities as well as some corporate level operations.

Alex Hart was Lithia's Internet and e-commerce director from September 2005 to May 2007 and reported to Jones.

"Don has had some terrific creative sales and promotion ideas and he had a lot to do with sales and growth of the company — both in the pre-public and during the public era," Hart said. "But the automotive business has changed in such a way that the information available to customers is enormous. In my opinion, he was of the 'Let's not give them the information' mind set."

As Lithia moved toward its Assured Pricing and money-back guarantee platform along with its used car stores, Jones was resistant. As time went by, friction grew. In the days following Lithia's first losing quarter during its public era, tension grew.

Comments on a Yahoo forum on Lithia's management suggested Jones was a sacrificial lamb and that more dismissals will follow, this the first week after Lithia posted its first quarterly loss as a publicly traded company. Hart didn't agree with that line of thinking.

"Two years ago when Dick (Heimann) and Bryan (DeBoer) were essentially co-presidents, Don was passed up for the position," he said. "This has been years in the making, it's not because of a bad quarter or bad year."

Sid DeBoer said Lithia has sold off many of its urban or suburban stores, where the company couldn't get the sales traction it hoped to achieve. Even the sometimes volatile Jones' hand-picked proteges failed in some of those endeavors.

"Their small stores do well in their processes, because they're easily managed from afar," Thompson said. "But with a big store you can't do that, you've got to have a GM that is allowed to run those stores. Bellevue Chevrolet used to be a strong dealership and they're not able to get Renton Chrysler on the map. Patience is a big issue, but under Don Jones they expected to turn around things in 90 days. I've been in the business 36 years and in my mind, if (a dealership) has taken years to mess up, it's going to take two years to straighten it out."

Hart, who now works for the Sullivan Automotive Group in Sacramento, said he doesn't expect to see a great deal more change.

"They're already running slim and mean as far as corporate management. The business is changing and anyone that doesn't want to change is in danger, that holds true of everyone nationwide; the family-owned companies with two dealerships are not surviving."

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

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