Auto dealership may be sold
By Andrew Gomes
Advertiser Staff Writer
After passing Hawai'i's oldest vehicle dealership from generation to generation, the family-owned Schuman Carriage Co. is exploring a sale of the 111-year-old kama'aina business.
Schuman Carriage noted the possibility of a sale in a letter informing employees of plans to lay off 31 workers in the parts and service departments Feb. 1 unless it receives concessions from the union representing most of those affected.
The company has been among the top five auto dealers in the state in recent years.
Company executives did not return calls seeking comment yesterday, but one person close to the business said a sale is being explored for succession planning reasons.
The source, who asked not to be identified because of concerns that it would harm a relationship with the Schumans or the company, said a deal could be reached this year, though no contract has been signed.
The company's letter, which proposes treating staff mechanics as contractors paid by the job, said the company would guarantee that a buyer retains union representation if union members accept the proposal and a purchase agreement is reached by April 30.
The offer, if accepted, would stall or eliminate layoffs for the 31 employees and more in other departments, and would last for a three-month trial period, after which the company and the union could revert to the existing contract and resume negotiations, the letter said.
The letter, a copy of which was obtained by The Advertiser, said the company's goal is to avoid personnel reductions and to make the parts and service departments profitable, though any employment changes would not affect "the price the company will be asking for its assets."
Dave Mori, director of the International Longshore and Warehouse Union division representing the affected workers, said there have been two months of on-and-off negotiations to reach new terms for a contract that has been extended since expiring in October.
Mori said union members will meet this week to consider the company's proposal, which he termed a "damned if you do, damned if you don't" offer.
"It's something we have to consider," he said.
Schuman Carriage operates Cadillac, Hummer, Buick, GMC and Oldsmobile dealerships on Beretania and Pi'ikoi streets. The company also operates Subaru dealerships in Waipahu and Kaimuki. Subsidiary Schuman Automotive owns three NAPA Auto Parts stores.
In October, Schuman Carriage sold four NAPA stores and its NAPA Hawaiian Warehouse, which distributes parts to 36 mostly independently owned NAPA stores in Hawai'i and Samoa. The buyer was Atlanta-based Genuine Parts Co.
Another NAPA store was sold to a Schuman manager.
The businesses sold to Genuine Parts accounted for $35 million in annual sales, according to Schuman Carriage. Total Schuman Carriage annual sales before the NAPA sales were estimated at $100 million.
Schuman Carriage was established as a horse-drawn buggy dealership in 1889 by Gustav A. Schuman, who came to Hawai'i from Germany in 1884 at the age of 16.
The company's founder became known as the "mule king" for his mule trading and is credited with introducing the first rubber-tired buggy in Honolulu.
Over the decades as the company's showroom vehicles changed from carriages to Model T's to LaSalles to Hummers, the business passed from Gustav A. Schuman to his son, Gustav W. "Scotty" Schuman, who passed company control to his son, Gustav E. "Dutch" Schuman. Dutch Schuman is company chairman today. His son, Richard Schuman, is a director and heads service operations.
Reach Andrew Gomes at agomes@honoluluadvertiser.com or 525-8065.
