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more photosLes Schwab Tire Centers’ current headquarters in Prineville.
Anthony Dimaano / The Bulletin
Les Schwab’s departure leaves hole in Prineville
• The Crook County town has been home to the tire empire’s headquarters since the 1950s. Soon, Prineville must cope with the loss of about 300 jobs to Bend.
By Erin Golden / The Bulletin
Published: February 24. 2008 4:00AM PSTPRINEVILLE — On almost every weekday afternoon for more than a decade, tire magnate Les Schwab took lunch with his company executives in the same place: a corner table at Meadow Lakes Restaurant with a panoramic view of the golf course.
More than nine months after Schwab’s death at age 89, the table is still his, reserved for employees who make the short trip across town from the corporate headquarters of the billion-dollar tire chain. And it’s not just a small table of corporate executives who frequent the restaurant. Some days — including Thursday, when company staff took up at least three large tables — Les Schwab employees lunching in the sun-filled dining room nearly outnumber the remaining customers.
But by the end of the year, when the Les Schwab Tire Centers’ corporate headquarters — and its approximately 300 administrative employees — move from Prineville to a new site in Bend, the lunch rush is going to look a little different.
“We’re building our budget for next year with the anticipation that our business could be substantially reduced,” said Wayne Van Matre, Meadow Lakes’ director of operations. “We’re not sure when the (drop) will happen ... but this is something we’ve been planning on.”
Although about 800 of the company’s approximately 1,150 Prineville employees will remain in town at the Schwab distribution center, the approaching loss of the administrative and upper-management staff is making waves across Crook County.
Several local leaders and business owners said they’re not sure exactly what will happen when Les Schwab moves more than a quarter of its staff, but that change is certainly in the air. The move could mean the loss of dozens of Prineville residents who choose to move to Bend, and at the very least, a large number of high-level jobs that could be hard to replace with so many other local cities competing for new businesses.
“It’s a constant problem for the region — the continuous challenge of how you get people to build in Prineville when Bend is next door,” said Crook County Judge Scott Cooper. “How do you grow yourself to the critical mass where you can meet those amenity needs?”
Making the move
Founded in the early 1950s, Schwab’s tire business grew out of an O.K. Rubber Welders tire store and expanded across the West and Alaska. Today, Les Schwab Tire Centers employs more than 7,000 people in 400 stores, according to the company’s Web site.
After a half-century in Prineville, the company announced in December 2006 that it would move its headquarters from the city’s west end to a new, 120,000-square-foot facility north of Cooley Road in Bend. Builders broke ground on the new site, located within the Juniper Ridge development, in September.
In a presentation to the Bend City Council on Wednesday, architects said workers should be able to move in by November.
Many locals said they were shocked when they first heard the news about a company they thought would never leave Schwab’s hometown. The news was tough on everyone but particularly on employees facing a choice between a long commute or a new community, said Prineville Mayor Mike Wendel.
“I think they’re worried that they’re going to have to commute to Bend,” Wendel said. “I don’t think they were ever anticipating having to move or commute to Bend when they took a job for Les Schwab — it was an organization that was planning on staying here in Prineville.”
Last month, Les Schwab spokeswoman Jodie Hueske said around 10 percent to 15 percent of the corporate office employees already live in and around Bend. But for the dozens of workers who call Prineville home, the prospect of a 75-mile, round-trip commute could mean more make the move to Bend. Hueske said employees who decide to sell their Prineville homes will receive some assistance with closing costs.
Hueske said the company will provide a shuttle bus service for employees between Prineville and Bend. The details of that arrangement will be worked out after officials survey employees later this year.
The business effect
With so much still up in the air, some Prineville residents, government leaders and business owners said they’re uncertain about what kind of hole the move will create in the community. At the Towne Pump, a gas station, grocery store and laundromat located next door to the Les Schwab main office and across the street from its distribution center, cashier Joanie Robertson said she was worried when she first heard the news and is still concerned about the loss of business from the Schwab lunch crowd.
“I about fainted,” Robertson said, remembering when she learned of the move. “I’m really worried, because a lot of our customers are Les Schwab people.”
The move could mean a loss for other service industries, including the hotels where Les Schwab hosts visiting executives. Restaurants like Meadow Lakes, which also provides catering service for Les Schwab corporate functions, will likely see a dip in business. Van Matre said his restaurant has already been losing some Les Schwab business for a couple of years after the company began hosting some of its events in Bend rather than Prineville.
Prineville-Crook County Economic Development Manager Jason Carr said conversation about the new Bend facility has dropped off since the initial announcement, but that Prineville is still preparing for whatever comes next.
“Lots of the business executives and management, the people at headquarters, are here every day, buying lunch out in the community, shopping at local stores,” he said. “I think the community is going to feel that when they pick up and leave.”
Prineville-Crook County Cham- ber President Jay Porter said he and other community leaders hope they’ll be able to find new businesses to replace the void created by the Les Schwab departure. In particular, he said the community needs to attract more professional-level, higher-paying jobs to complement the rest of the Prineville job market.
“It would be really nice to see something come in that does have the range of professional and blue-collar work,” he said. “With Les Schwab, what’s leaving is the white collar and the blue collar is staying. It would be nice to see more professional and administrative, because we rely pretty heavily on mills and Les Schwab’s warehouse for general employment. (Those jobs) are not the higher wage-earners that a town needs.”
Looking ahead
An uncertain economy and dramatic downturn in the building industry could complicate the loss. The latest building permit data for Crook County shows a 94 percent drop in permits for homes in January.
At the least, filling the empty Les Schwab office building could be difficult, said Crook County Assessor Tom Green.
“We won’t really know what can be made of that building, whether they would raise it or convert it to businesses,” he said. “It probably depends on the market — you can’t measure it at this point. If this had happened a couple years ago, that would be a significant piece of property there, and they maybe could get something like a Wal-Mart to build there or just tear it down. But at this point, the market is very slow and people are very tentative, and it would be hard to market that at all.”
At the Crook County School District, officials were initially concerned that the move could make for a dramatic drop in enrollment. But now, Superintendent Steve Swisher said he believes many families will stick around, and the impact will probably be minimal.
“There was a fear at one point that some of the operations were going to be moving and speculation about the headquarters moving out of state,” he said. “It was sort of a relief that it was just a short Central Oregon move ... we have many people in the warehouses that have kids in school but fewer people in the central office. We thought we would have some impact, but now we’re quantifying that in terms of 20 or 30 students (possibly leaving) instead of 200 or 300.”
And at Meadow Lakes, where the tables of Les Schwab employees will soon come exclusively from the production facilities, longtime server Jennifer Miller said it’s simply too soon to tell just what the move will mean for Prineville. Miller, who often waited on Schwab when he came in for lunch, said the business’s namesake would likely be surprised by the turn of events.
“Because he was kind of old school, he might have had a little bit of a hard time with (the move to Bend),” she said. “But sometimes, change is good — I guess the company is doing what it has to do.”
Erin Golden can be reached at 408-2836 or at egolden@bendbulletin.com.
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