Business brightens for family blindsided by economy, cancer

Originally published Nov. 9, 2010

For most of the summer, as he mourned the loss of his family’s Dodge dealership after three generations, Larry Weathers Jr. handled chemotherapy with resilience.

No one would be able to attribute the onset of his cancer to the stress induced by Chrysler's bankruptcy, the demise of Weathers Dodge, or the nation's worst recession since the Great Depression. But in his darkest moments, Junior, as he was known, had to wonder whether it was all somehow related.

Still, he was holding up relatively well. Even he could hardly tell he was sick; that helped everyone else deal with the shocking news, too.

"Clinically, he's tolerating the therapy very well," said his oncologist, Lynn M. Schuchter of the Abramson Cancer Center of the University of Pennsylvania, in July. "His blood tests look great."

At what had become his Delaware County used-car dealership, Weathers Motors, his sales staff struggled to hit monthly targets, though no one was giving up. Junior's grim prognosis only added to a gathering uncertainty.

"We don't talk about it," said title clerk Melissa Mattero.

As Junior prepared for more chemo to attack tumors on his liver and brain, he braced for a new shock to his system: a federal audit probing what he and others saw as a harsh message from the Obama administration's Auto Team that Chrysler and General Motors shed dealerships - and shed them fast.

The 41-page audit, released on July 19, condemned the process that had turned Weathers Dodge and other Chrysler and GM dealerships into bankruptcy roadkill:

". . . [I]t is not at all clear that the greatly accelerated pace of the dealership closings during one of the most severe economic downturns in our Nation's history was either necessary for the sake of the companies' economic survival or prudent for the sake of the Nation's economic recovery."

The man behind the report was former New York federal prosecutor Neil M. Barofsky, a mortgage securities-fraud expert who had once prosecuted Colombian drug traffickers. President George W. Bush had named him to lead the new Office of the Special Inspector General of the Troubled Asset Relief Program (TARP) fund.

Barofsky's job was to oversee how TARP fund loans were being used to stabilize the economy. About $80 billion went to Chrysler and GM. Their Chapter 11 bankruptcy reorganization was steered by a Treasury Department Auto Team as a condition of receiving aid.

"None of the Auto Team leaders or personnel," wrote Barofsky, "had any experience or expertise in the auto industry." What the investment bankers chosen by the Obama administration had was a prevalent Wall Street belief that companies must not waste bankruptcy's power to cut corners.

They "absolutely encouraged Chrysler and GM to use bankruptcy to solve what they thought was this problem with too many dealers," Barofsky said in an interview after release of his report. "The philosophy as it was described to us was 'quicker, quicker, quicker.' "

But what was the problem with "too many dealers"? How would cutting them save money? Save the companies?

One thing Barofsky found: To be successful, industry thinking went, be more like Toyota. The Japanese automaker sold reliable and fuel-efficient cars, but car manufacturers were enthralled by how few dealerships it had.

Chrysler, for instance, sold only about one million new vehicles in 2008 through about 3,300 dealerships. Toyota, with about 1,200 dealerships, sold 1.6 million.

Chrysler, with quality issues and low fuel efficiency, had been trying for years, through its Project Genesis, to have franchise owners merge or sell out.

If there was one thing Weathers might have done, in hindsight, to make things different, it was to better understand Chrysler's desire to have dealers sell all three of its brands, Dodge, Chrysler, and Jeep. But Weathers believed prompt and high-quality service and honesty should have been enough.

"You can't say, 'Didn't see it coming,' " Junior said later.

Chrysler and GM believed that many dealerships - and Weathers competed with three nearby - undercut prices and forced manufacturers to offer rebates and other costly incentives. Barofsky found others in the industry agreed.

But Michigan - not the dealers - set prices. Dealers bore most of the costs of acquiring, advertising, and selling new vehicles. It wasn't as though manufacturers could save a lot on that end.

Even the automakers had trouble demonstrating how reducing dealerships so rashly would save money. In estimates provided to Congress after franchises were ordered shut, GM and Chrysler came up with numbers.

For GM, each closed outlet would save $1.1 million.

Chrysler's estimate: $45,501 per dealership.

"Their discrepancy alone," Barofsky said, "calls into question their credibility."

Yet the Auto Team seemed enamored with "brand equity," Barofsky found, the idea that fewer, larger dealers would have more money to invest in the frills and flash that could entice more customers. It was the very concept Junior had resisted for years.

"A flat-screen TV can't fix a car," he liked to say.

Junior and his son Larry III had tried several years earlier to add Jeep to Weathers Dodge, but Chrysler rebuffed them, Junior said.

"You'll wilt on the vine," Junior said Chrysler told them. "You, as a single-point dealer, are not going to have the product to survive."

"We will!" the Weathers men replied in earnest. "We'll survive with Dodge."

After all, franchise laws were on their side, rock-solid. Always had been.

"The only thing that stuck in my mind," Junior said, "was that our loyalty to Chrysler Corp. would trump anything else."

The companies filed for bankruptcy - Chrysler on April 30, 2009, followed by GM on June 1, 2009. At the urging of the Auto Team, Chrysler bankruptcy plans included radical dealer cuts: 53 in Pennsylvania, eight in the southeastern five counties. New Jersey would lose 30.

Chrysler spokesman Mike Palese said Friday: "The process was data-based, it was consistent, it met the requirements of the restructuring and the requirements of the company to be competitive in the future."

In its response to the federal audit, the company noted that surviving dealers "were enjoying increased profitability" and were "making significant investments in their dealerships."

The audit uncorked Larry III's anger.

"It's no way to treat an American business," he said, "an entrepreneur that has an established business going. . . . I think it's criminal. I really do. I think someone should be hung over it."

Amid published reports that his office was looking into potential criminal activity, Barofsky, contacted last month through a spokeswoman, declined to comment further.

In its own response to the audit, the Treasury Department "strongly" disagreed with its conclusions, citing the economic crisis that required "deep and painful sacrifices."

Near the end of the summer, Junior joined a conference call of rejected dealers considering suit against the government, and the Treasury Department specifically.

Legal action could take three or four years, a lawyer said, and each dealer would have to pay $30,000, Junior recalled.

"There were over 100 people on the conference call," Junior said, amused. "As soon as he gave the price, they had to stop the conference call because so many people were logging off."

In early August, Larry III talked on the phone about his relationship with his dad, and how cancer was changing it.

"I started thinking about all the things I've learned from him. That he taught me. That I probably took for granted."

For years, the two occasionally chafed nerves as they rubbed shoulders. It hadn't always gone well. But now, Larry III was searching for paternal virtues rather than flaws.

"I don't want to stand at somebody's funeral and start saying all these things they meant to me, and then say, 'Why didn't I say all these things to him while he was alive?' "

For years, his father's refusal to throw things away - even broken possessions - had seemed to be signs of weakness, of a man who could not accept change. In August, Larry III was rethinking that judgment.

"I learned from him that anything can be fixed," the son said. "He taught me not to be afraid to fix things."

Larry III would think back, put his thoughts into e-mails, and send them to his dad.

"I mean, he's the one who introduced me to going to church. He's the one that didn't allow me to come work here right out of college. He wanted me to go out and work for other people so I could find out that I could survive and work on my own."

Such reflection, though, remained difficult for Junior. He received his son's e-mails, even a YouTube video of a collapsed runner whose dad carries him to the finish line.

"I don't know what he meant by that," Junior said.

Such obtuseness no longer annoyed Larry III. "I know him, and that's OK with me."

Later that night, Larry III marveled in an e-mail at the change in the family.

He wrote:

"My son, Lawrence Weathers IV, 20 years old . . . heard his father, me, expressing thoughts about my father as he journeys through cancer."

As his father had been speaking of Junior, the young man had been nearby, tapping away on a computer. He was helping the new family business by filming videos about cars in stock and posting them on Facebook.

"Amazing the timing," his dad wrote. "I think my son really began to see who I really am. . . . If this was a by-product of losing the dealership, it is all worth it."

Junior and Larry III had a lot to resolve, from how to handle the business if Junior died to all the unspoken emotions and memories, spats and love of a lifetime.

One day near the end of summer, alone in his Weathers Motors office, Junior tried to name ways he and his son were alike, rather than the much easier task of saying how they were different.

"How are we similar?" There was an awkward silence. "I don't know. We care about people."

Nothing else?

Junior lifted a hand, scratched his arm, and strained for an answer. Finally he found it.

"He's my son."

On Aug. 17, Junior was enjoying something rare: a three-week vacation.

He had never spent so much time at his Ocean City condo in a single summer; it would have meant time away from Weathers Dodge. But after the cancer diagnosis, he visited more, wading deep into the pounding surf.

"I feel good," he said. "I will admit that I'm taking it easy."

His wife, Helene, noticed the change. She had known him almost all her life and married him more than 20 years ago, after he divorced his first wife. "A little more relaxed," she said of him. "Taking it a little bit easier."

"He comes home for lunch and actually sits in the chair and relaxes," she said, "and comes home 4, 4:30." That means more time for her and their two children.

"I know my time is limited now," Junior said. Then optimism caused him to reconsider. "I don't know what my time is, actually."

In the middle of his vacation, Junior trudged back to the University of Pennsylvania Hospital for a full-body scan that would reveal the extent of his tumors.

"Went well," he said, back at the Shore.

Ahead, more chemo, more tests. His fatigue increased. Although his venturing deep into the waves made her anxious, Helene marveled at her husband's equanimity.

"Both my parents died of cancer, and both were so accepting," she said. "Larry's the same way."

Junior always assumed that, like his father, he'd live to 98 and spend his days at the garage. The worst thing would be if he couldn't go there. Helene was sure of that.

Tom Tague, the salesman, agreed. "I've been here for almost 24 years. He's always here. He's just a fixture."

Business was picking up. Word was getting around that Weathers Motors was a good place to buy a used car. Tague sold a black Chrysler 300 to a New York cabdriver who had driven all the way to Delaware County after hearing good things from a nephew.

One recent customer was Carol DeMarco, the popular receptionist let go during layoffs. After losing her job, she worried about loneliness. But she fills time with friends, including those she left behind at Weathers.

Just last week she took her Chrysler 300M to the shop for repairs and conversation. "When I go in, it's open arms, hug and kiss."

And in her mailbox at home, she receives pictures of Tague's girls, with notes like "Love you. Miss you."

"The girls are so pretty," she said.

DeMarco is looking for work - at 72, "who wants to hire me?" - but she's making ends meet.

Tague's been doing well enough to turn down job offers from three other dealerships, though he worked a side job over the summer.

"I'm bred and born here, know what I mean? My grandparents have been buying cars here since the '40s. I'm not going to abandon ship just because the grass looks greener on the other side."

The momentum continued through autumn. The repair shop, in the recession, was busy. And finally, enough cars were selling - about 40 a month - to keep the business safely in the black.

"In the past three months, it has really picked up," Junior said Wednesday.

In October, the dealership hired another mechanic. Also, Weathers may no longer have to use cash reserves to buy cars at auction. Junior learned a few days ago that a crucial bank loan for inventory would be approved - something impossible in the last year. New medical tests were encouraging, too.

If given the chance, would Junior ever go back to being a Dodge dealer? No.

"I have this terrible feeling of hurt that Chrysler could do that to us," he said, "and it has just taken me time to realize you just got to move ahead. You got to forget about it.

“I don’t forget about it,” he said. “But you have to.”