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Company Chairman Gustav E. Schuman told a group of employees earlier this month that "he's 75 years old and he just wants to get out of the business," said Schuman mechanic Reginald Kort. "Everybody has the right to retire."
There are no relatives who wish to take the reins of the one-time seller of horse-drawn carriages. Richard Schuman, Gustav Schuman's son and an operations manager of Schuman Carriage, also is president of helicopter company Schuman Aviation Co.
The elder Schuman also told employees that the company and General Motors could not come to an agreement in which the automaker would operate the dealerships, Kort said.
The auto dealer's employees and the state received official notice of the company's plans Monday.
Schuman issued a statement yesterday saying it had agreed to end its more than 70-year tenure as a General Motors dealer. Schuman expects the carmaker to announce arrangements for continued GM warranty service in Hawaii before Schuman closes.
The move affects Schuman's Buick, Cadillac, GMC and Hummer automotive lines. Schuman's Subaru dealerships also will close, but the company will remain the Hawaii distributor for Subaru, providing the cars to other dealers.
The next step could potentially include a new dealership in Kakaako at the site of a former Schuman-owned NAPA auto parts store, according to Kort.
Retail car sales in Hawaii are beyond brisk across most makes and models, but Schuman's exploration into trying to sell its dealerships over the past several months came up empty.
Overall retail vehicle sales from January through August of this year rose 16 percent from the same period last year, according to figures compiled by R.L. Polk, an automotive data company.
Sales have been "as good as it gets for the last 10 or 12 years," said Curtis Lee, general manager of automotive operations for competitor Servco Pacific Inc. He could not imagine General Motors giving up its share of the high-end auto market "completely -- not without a fight." Cadillac sales are coming back nationwide with new marketing and models, he said.
Servco also does business with General Motors, selling Chevrolet models at some of its Oahu dealerships.
"Typically, we work with dealers closely and try to search for a purchaser of their business and make it an easy transition," she said.
"We are continuing to focus on having Cadillac, Hummer, Buick and GMC representation in Honolulu."
Reyes declined to comment on the breakup between Schuman and GM.
Breakups between manufacturers and dealers are common on the mainland, but they are uncommon in the islands, said Joe Nicolai, president of the parent company of JN Chevrolet and several other Oahu auto dealerships.
With this latest development, union members have been offered severance packages and final terms are pending discussions between the union and the company.
Word of a possible sale of Schuman Carriage first arose in a company-authored memorandum posted for union employees in January. The memo outlined a two-part goal to avoid reducing personnel and to make departments profitable.
"Should we accomplish these two goals, it is the company's opinion that whoever may consider purchasing Schuman Carriage Company will accept the majority of the union members," the memo said.
Union officials did not return calls seeking comment.
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