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Sincerely,



John E. Sztykiel
President and Chief Executive Officer

Your vote is important. Even if you plan to attend the meeting,
PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY PROMPTLY.

(1)

consider and vote on the election of three directors to three-year terms expiring in 2006;

(2)

consider and vote on a proposal to approve the Spartan Motors, Inc. Stock Option and Restricted Stock Plan of 2003;

(3)

consider and vote on a proposal to ratify the appointment of Ernst & Young LLP as Spartan Motors' independent auditors for the current fiscal year; and

(4)

transact such other business as may properly come before the annual meeting.

Your vote is important. Even if you plan to attend the meeting,
PLEASE SIGN, DATE AND RETURN THE ENCLOSED PROXY PROMPTLY.

Use of Terms

          In this proxy statement, "we," "us," "our" and "Spartan Motors" refer to Spartan Motors, Inc., and "you" and "your" refer to shareholders of Spartan Motors.

Time and Place of Annual Meeting

          You are cordially invited to attend the 2003 annual meeting of shareholders of Spartan Motors, Inc. The annual meeting will be held on Wednesday, May 28, 2003 at the Gray Exhibition Building, Eaton County Fairgrounds, 1025 South Cochran Avenue, Charlotte, Michigan 48813, at 4:00 p.m., local time.

Solicitation of Proxies

          This proxy statement and the enclosed proxy card are being furnished to you in connection with the solicitation of proxies by Spartan Motors' board of directors for use at the annual meeting, and any adjournment of the meeting.

Mailing Date

          This proxy statement is being mailed to Spartan Motors' shareholders on and after April 30, 2003.

Purposes of the Meeting

          The purposes of the annual meeting are to consider and vote on:

• the election of three directors to three-year terms expiring in 2006;

• the approval of the Spartan Motors, Inc. Stock Option and Restricted Stock Plan of 2003;



• the ratification of the appointment of Ernst & Young LLP as our independent auditors for the current fiscal year; and



• such other business as may properly come before the meeting.

          We do not know of any other matters to be presented for consideration at the annual meeting. If any other matters are presented, the persons named as proxies on the enclosed proxy card will have discretionary authority to vote on those matters in accordance with their judgment.

Record Date

          You may vote at the meeting if you were a shareholder of record of Spartan Motors common stock on April 7, 2003. Each such shareholder is entitled to one vote per share on each matter presented for a shareholder vote at the meeting.

          As of April 7, 2003, there were 12,149,577 shares of Spartan Motors common stock outstanding.

How to Vote Your Shares

          If you are a shareholder of record, that is, you hold your Spartan Motors stock in certificate form, you may vote by returning the enclosed proxy card. If you properly complete and sign the enclosed proxy card and return it so that we receive it before the meeting, the shares

of Spartan Motors common stock represented by your proxy will be voted at the annual meeting and any adjournment of the annual meeting, as long as you do not revoke the proxy before or at the meeting.

          Regardless of how you vote, if you specify a choice, your shares will be voted as specified. If you do not specify a choice on your signed, returned proxy, your shares will be voted for (1) the election of all nominees for director named in this proxy statement, (2) approval of the Spartan Motors, Inc. Stock Option and Restricted Stock Plan of 2003, (3) the ratification of the appointment of Ernst & Young LLP as Spartan Motors' independent auditors for the current fiscal year and (4) with respect to any other matters that may come before the meeting or any adjournment of the meeting, in accordance with the discretion of the persons named as proxies on the proxy card.

"Street Name" Shareholders

          If you hold your shares in "street name," that is, your shares are registered in the name of a bank, broker or other nominee, which we will collectively refer to as your "broker," your broker must vote your shares if you provide it with proper and timely voting instructions. Please check the voting forms and instructions provided by your broker or its agent.

How to Revoke Your Proxy

          If you are a shareholder of record, you may revoke your proxy at any time before it is voted at the meeting by doing any of three things:

• by delivering written notice of revocation to Spartan Motors' Corporate Secretary, 1165 Reynolds Road, Charlotte, Michigan 48813;



• by delivering a proxy card bearing a later date than the proxy that you wish to revoke; or



• by attending the meeting and voting in person.

          Your last vote properly received before the meeting is the vote that will be counted. Please note that attending the meeting will not by itself revoke your proxy.

          If you are a street name holder and have instructed your broker to vote your shares, you must follow directions from your broker to change your vote.

Quorum

          In order for business to be conducted at the meeting, a quorum must be present. The presence in person or by properly executed proxy of the holders of a majority of all of the issued and outstanding shares of Spartan Motors common stock entitled to vote is necessary for a quorum at the meeting. For purposes of determining whether a quorum is present, we will include shares that are present or represented by proxy, including abstentions and broker non-votes.

Adjournment

          The shareholders present at the meeting, in person or represented by proxy, may by a majority vote adjourn the meeting despite the absence of a quorum. If there is not a quorum at the meeting, we expect to adjourn the meeting to solicit additional proxies.

Required Votes

          Election of Directors. A plurality of the shares voting is required to elect directors. This means that if there are more nominees than positions to be filled, the nominees who receive the most votes will be elected to the open director positions. In counting votes on the election of directors, abstentions, broker non-votes and other shares not voted will be counted as not voted. These shares will be deducted from the total shares of which a plurality is required.

          Other Matters. The proposals to approve the Spartan Motors, Inc. Stock Option and Restricted Stock Plan of 2003 and to ratify the appointment of Ernst & Young LLP as Spartan Motors' independent auditors for the

current fiscal year will be approved if a majority of the shares voted at the meeting are voted in favor of those proposals. In counting votes on those proposals, abstentions and broker non-votes will not be counted as voted. Shares that are not voted will be deducted from the total shares of which a majority is required.

          We do not know of any other matters to be presented for shareholder action at the annual meeting.

          Broker Non-Votes. A broker non-vote occurs when a shareholder holds his or her stock through a broker and the broker does not vote those shares. This usually occurs because the broker has not received timely voting instructions from that shareholder and the broker

do not have discretionary voting power for the particular item upon which the vote is taken.

          We do not believe that your broker will have discretionary authority to vote your shares with respect to the Stock Option and Restricted Stock Plan of 2003 if you do not provide your broker with timely instructions as to how you wish to vote your shares. It is important that you instruct your broker how to vote shares held by you in street name using the vote instruction form provided by your broker. Your broker should vote your shares as you direct if you provide timely instructions on how to vote by following the information provided to you by your broker.

Nominees for Election

          The board of directors proposes that the following three individuals be elected as directors of Spartan Motors for three-year terms expiring at the annual meeting of shareholders to be held in 2006:

John E. Sztykiel
Charles E. Nihart
Kenneth Kaczmarek

          Each nominee is presently a director of Spartan Motors whose term will expire at the annual meeting. Biographical information concerning the nominees appears below under the heading "Spartan Motors' Board of Directors and Executive Officers," beginning on page 12.

          The persons named as proxies in the proxy card intend to vote for the election of each of the nominees. The proposed nominees are willing to be elected and to serve as directors of Spartan Motors. However, if any or all or the nominees become unable to serve or otherwise unavailable for election, which we do not anticipate, the incumbent board of directors may or may not select a substitute nominee or nominees. If a substitute nominee or nominees is or are selected, the shares represented by your proxy card will be voted for the election of the substitute nominee(s), unless you give other instructions. If a substitute is not selected, all proxies will be voted for the election of the remaining nominee(s). Proxies will not be voted for more than three nominees.

          Your board of directors recommends that you vote FOR election of each nominee.

General

          The board of directors believes that the long-term interests of Spartan Motors would be advanced by aligning the interests of its directors, officers and employees with the interests of its shareholders. Therefore, to attract, retain and motivate directors and employees of exceptional abilities, and to recognize the significant contributions these individuals have made to the long-term performance and growth of Spartan Motors and its subsidiaries, on April 22, 2003, the board of directors adopted and approved, subject to shareholder approval, the Spartan Motors, Inc. Stock Option and Restricted Stock Plan of 2003 (the "Plan"). The Plan is intended to supplement and continue the compensation policies and practices of our other equity compensation plans, which we have used for several years, including our 1994 Incentive Stock Option Plan and our Stock Option and Restricted Stock Plan of 1998. Because these Plans will soon be completely utilized, the board of dir ectors believes that approval of the Plan is advisable to make additional shares available for stock options and other awards.

          We intend to use the Plan to grant equity-based incentives to eligible participants. Most of the options granted under our current and prior plans (other than those granted to non-employee directors) have been incentive stock options within the meaning of the Internal Revenue Code. Incentive stock options must have an exercise price equal to the market value of the underlying stock on the date of the option grant. The Plan would authorize the continued grant of incentive stock options. The Plan also would permit the grant of other forms of long-term incentive compensation, if determined to be desirable to advance the purposes of the Plan. These other forms of long-term incentive compensation include non-qualified stock options and restricted stock (together with incentive stock options, collectively referred to as "incentive awards"). By combining in a single plan many types of incentives commonly

used in long-term incentive compensation programs, the Plan is intended to provide Spartan Motors with a great deal of flexibility in designing specific long-term incentives to best promote the objectives of the Plan and in turn promote the interests of our shareholders.

          No incentive awards have yet been made under the Plan. As such, the benefits to be received by our directors, executive officers and other employees are not presently determinable and the benefits that would have been received had the Plan been in effect for the most recent fiscal year are similarly not determinable. However, the Plan provides that directors who are not employees of Spartan Motors or its subsidiaries will receive (to the extent not received under current plans) two incentive awards per year: a non-qualified stock option to purchase 3,500 shares of Spartan Motors common stock will be granted to such non-employee directors (7,500 to the Chairman of the Board if the Chairman is a non-employee director) on June 30 and December 31 of each year. These director stock options are required to have an exercise price not lower than 85% of the per-share market value of Spartan Motors common stock on the date of grant, although such options granted to our no n-employee directors under current plans have historically had exercise prices equal to the market price of the underlying Spartan Motors common stock on the grant dates.

          The Plan would not be qualified under Section 401(a) of the Internal Revenue Code and would not be subject to the Employee Retirement Income Security Act of 1974 (ERISA).

          The following is a summary of the principal features of the Plan. This summary is not complete and is qualified in its entirety by reference to the terms of the Plan, a copy of which is attached as Appendix A to this proxy statement.

Authorized Shares

          Subject to certain anti-dilution adjustments, 1 million shares of Spartan Motors common stock would be available for issuance under the Plan. Shares subject to incentive awards that are canceled, surrendered, modified, exchanged for substitute awards or that expire or terminate would remain available under the Plan. On April 22, 2003, the closing price of Spartan Motors common stock on Nasdaq was $9.26 per share. The Plan would not allow more than 50% of the shares authorized under the Plan to be issued as restricted stock. The Plan would not allow any participant to receive, in any calendar year, incentive awards issued under the Plan with respect to more than 125,000 shares of Spartan Motors common stock.

Eligible Participants

          We anticipate that the persons who will receive incentive awards under the Plan will be directors of Spartan Motors (currently seven persons) and officers (currently one additional person) and other employees (currently approximately 720 additional persons) of Spartan Motors and its subsidiaries. Under our current and prior plans, we have granted stock options to all employees who meet certain length-of-service requirements (typically, one year). Additional individuals may become directors, officers or employees in the future and could participate in the Plan. Directors, nominees for director, officers and employees of Spartan Motors and its subsidiaries may be considered to have an interest in the Plan because they may in the future receive incentive awards under it.

Administration of the Plan

          The Plan would be administered by the Compensation Committee of the board of directors. The Compensation Committee would determine, subject to the terms of the Plan, the persons to receive incentive awards, the nature and amount of incentive awards to be granted to each person (subject to the limits specified in the Plan), the time of each grant, the terms and duration of each grant and all other

determinations necessary or advisable for administration of the Plan. The Compensation Committee could amend the terms of incentive awards granted under the Plan from time to time in any manner, subject to the limitations specified in the Plan.

Stock Options

          The Plan would permit Spartan Motors to grant to participants options to purchase shares of Spartan Motors common stock at stated prices for specific periods of time. Some stock options may qualify as incentive stock options as defined in Section 422 of the Internal Revenue Code. Other stock options would not be incentive stock options within the meaning of the Internal Revenue Code. Incentive stock options would be available only for employees. They would not be available for directors who are not employees. Stock options could be granted at any time before April 21, 2013, unless the Plan is earlier terminated by the board. The Compensation Committee could award options for any amount of consideration or no consideration, as the Compensation Committee determines.

          The Compensation Committee would establish the terms of individual stock option grants in stock option agreements or certificates of award, or both. These documents would contain terms, conditions and restrictions that the Compensation Committee determines to be appropriate. These restrictions could include vesting requirements to encourage long-term ownership of shares. The terms could also provide for automatic regrants of options. Automatic regrants could be for the number of previously owned shares held by that individual for at least six months that are surrendered to Spartan Motors in connection with the exercise of an outstanding stock option or the payment of taxes in connection with the vesting of restricted stock or the exercise of a stock option.

          The exercise price of a stock option would be determined by the Compensation Committee. The Compensation Committee does not presently intend to grant any options at an exercise price less than the closing market price

of Spartan Motors common stock on the date of grant. As required by the Internal Revenue Code, the exercise price of incentive stock options must be at least equal to the fair market value of Spartan Motors common stock on the date of grant. No incentive award could be repriced, replaced, regranted through cancellation or modified without shareholder approval if the effect of such repricing, replacement, regrant or modification would be to reduce the exercise price of then-outstanding incentive awards to the same participants.

          When exercising all or a portion of a stock option, a participant could pay the exercise price with cash or, if permitted by the Compensation Committee, shares of Spartan Motors common stock that the participant has held for at least six months, or other consideration substantially equal to cash. The Compensation Committee could also authorize payment of all or a portion of the exercise price in the form of a promissory note or installment payments, except as limited by the Sarbanes-Oxley Act of 2002 or other laws, rules or regulations. Any promissory note or installment payments must be with full recourse and at the market rate of interest. The board of directors could restrict or suspend the power of the Compensation Committee to permit such loans, however, and could require that adequate security be provided.

          Although the term of each stock option would be determined by the Compensation Committee, no stock option would be exercisable under the Plan after ten years from the date it was granted. Stock options generally would be exercisable for limited periods of time if an option holder dies, becomes disabled, is terminated without cause, or voluntarily leaves his or her employment or directorship before retirement (as defined in the Plan). If an option holder is terminated for cause (as determined by the Compensation Committee or officers designated by the Compensation Committee), the option holder would forfeit all rights to exercise any outstanding stock options. Subject to the other terms of the Plan, if an option holder retires, the option holder could exercise options for the remainder of their terms, unless the terms

of the option agreement or award provide otherwise.

          Without Compensation Committee approval, stock options granted under the Plan generally could not be transferred, except by will or by the laws of descent and distribution, unless transfer is permitted by the terms of the grant or the applicable stock option agreement.

Federal Tax Consequences of Stock Options

          Incentive Stock Options. Under current federal income tax laws, an option holder would not recognize income and Spartan Motors would not receive a deduction when an incentive stock option is granted. An option holder exercising an incentive stock option would not recognize income at the time of the exercise. However, the difference between the market value and the exercise price would be a tax preference item for purposes of calculating alternative minimum tax. Upon the sale or other disposition of the underlying stock, as long as the option holder held the stock for at least one year after the exercise of the stock option and at least two years after the grant of the stock option, the option holder's basis would equal the exercise price and the option holder would pay tax on the difference between the sale proceeds and the exercise price as capital gain. Spartan Motors would receive no deduction for federal income tax purposes.

          If, before the expiration of either of the two holding periods described above, the option holder sold shares acquired under an incentive stock option, the option holder generally would recognize compensation taxed as ordinary income equal to the difference between (1) the lesser of (a) the fair market value of the stock at the time of exercise or (b) the amount realized on the sale or disposition and (2) the exercise price paid for the stock. Spartan Motors would then receive a corresponding deduction for federal income tax purposes, except to the extent that the deduction limits of Section 162(m) of the Internal Revenue Code apply. Additional gains, if any, recognized by the option holder would result in the recognition of capital gain.

          Nonqualified Stock Options. Federal income tax laws provide different rules for nonqualified stock options that do not meet the Internal Revenue Code's definition of an incentive stock option. An option holder would not recognize any income and Spartan Motors would not receive a deduction when a nonqualified stock option is granted. If a nonqualified stock option is exercised, the option holder would recognize compensation income equal to the difference between the fair market value of the stock on the date of exercise and the exercise price paid. Spartan Motors would receive a corresponding deduction for federal income tax purposes, except to the extent that the deduction limits of Section 162(m) of the Internal Revenue Code apply. The option holder's tax basis in the shares acquired would be the exercise price paid plus the amount of compensation income recognized. Sale of the stock after exercise would result in recognition of short-term or long-term capi tal gain (or loss).

Restricted Stock

          The Plan also permits the Compensation Committee to award restricted stock, subject to the terms and conditions set by the Compensation Committee that are consistent with the Plan. The Compensation Committee could award restricted stock for any amount of consideration or no consideration, as the Compensation Committee determines.

          As with stock option grants, the Compensation Committee would establish the terms of individual awards of restricted stock in restricted stock agreements or certificates of award. Restricted stock granted to a participant would "vest" (i.e., the restrictions on it would lapse) in the manner and at the times that the Compensation Committee determines.

          Unless the Compensation Committee otherwise consents or permits or unless the terms of a restricted stock agreement or award provide otherwise, if a participant's employment or directorship is terminated during the restricted period (i.e., the period of time during which restricted stock is subject to restrictions) for any reason other than death, disability or retirement,

the shares of the participant's restricted stock that are still subject to restrictions at that time would be forfeited and returned to Spartan Motors. If the participant's employment or directorship is terminated during the restricted period because of death, disability or retirement, the restrictions on the participant's shares of restricted stock would terminate automatically with respect to that number of shares (rounded to the nearest whole number) equal to the total number of shares of restricted stock awarded to the participant, multiplied by the number of full months that have elapsed since the date of grant, and then divided by the total number of full months in the restricted period. All of the remaining shares would be forfeited and returned to Spartan Motors, unless the Compensation Committee provides otherwise.

          Until the restricted stock vests, a recipient of restricted stock would not be allowed to sell, exchange, transfer, pledge, assign or otherwise dispose of restricted stock other than to Spartan Motors or by will or the laws of descent and distribution without Compensation Committee authorization. The Compensation Committee could impose additional restrictions on shares of restricted stock. Holders of restricted stock would enjoy all other rights of a shareholder with respect to restricted stock, including the right to vote restricted shares at shareholders' meetings and the right to receive dividends. Any securities received by a holder of restricted stock pursuant to a stock dividend, stock split, recapitalization, merger, consolidation, combination or exchange of shares would be subject to the same terms, conditions and restrictions that are applicable to the restricted stock with respect to which the shares are received.

Federal Tax Consequences of Restricted Stock

          Generally, under current federal income tax laws a participant would not recognize income upon the award of restricted stock. However, a participant would be required to recognize compensation income at the time the restricted stock vests equal to the difference between the fair market value of the stock at

vesting and the amount paid for the stock (if any). At the time the participant recognizes compensation income, Spartan Motors would be entitled to a corresponding deduction for federal income tax purposes, except to the extent that the deduction limits of Section 162(m) of the Internal Revenue Code apply. If restricted stock is forfeited by a participant, the participant would not recognize income and Spartan Motors would not receive a deduction. Before the time the restricted stock vests, dividends paid on restricted stock would be reported as compensation income to the participant and Spartan Motors would receive a corresponding deduction, except to the extent that the deduction limits of Section 162(m) of the Internal Revenue Code apply.

          A participant could, within 30 days after the date of an award of restricted stock, elect to report compensation income for the tax year in which the restricted stock is awarded. If the participant makes this election, the amount of compensation income would be equal to the difference between the fair market value of the restricted stock at the time of the award and the amount paid for the stock (if any). Any later appreciation in the value of the restricted stock would be treated as capital gain and recognized only when the participant sells the restricted stock. Dividends received after such an election would be taxable as dividends and not treated as additional compensation income. If, however, restricted stock is forfeited after the participant makes such an election, the participant would not be allowed any deduction for the amount that he or she earlier reported as income. Upon the sale of restricted stock, a participant would recognize capital gain (or loss) in the amount of the difference between the sale price and the participant's basis in the stock.

Effects of a Change in Control of Spartan Motors

          Upon the occurrence of a "change in control" of Spartan Motors (as defined in the Plan), all outstanding stock options would become immediately exercisable in full and would remain exercisable in accordance with their terms. All other outstanding incentive

awards under the Plan would immediately become fully vested, exercisable and nonforfeitable. In addition, the Compensation Committee, without the consent of any affected participant, could determine that some or all participants holding outstanding stock options would receive, in lieu of some or all of their stock options, cash in an amount equal to the greater of the excess of (1) the highest sale price of the shares on Nasdaq (or whatever quotation system or stock exchange on which Spartan Motors common stock is listed at the time) immediately before the effective date of the change in control or (2) the highest price per share actually paid in connection with the change in control, over the exercise price of the stock options.

Tax Withholding

          If incentive awards are made under the Plan, Spartan Motors could withhold from any cash otherwise payable to a participant or require a participant to remit to Spartan Motors amounts necessary to satisfy applicable withholding and employment-related taxes. Minimum required tax withholding obligations could also be satisfied by withholding Spartan Motors common stock to be received upon exercise of or vesting of an incentive award or by delivering to Spartan Motors previously owned shares of common stock.

Termination and Amendment of the Plan

          The board of directors could terminate the Plan at any time and could from time to time amend the Plan as it considers proper and in the best interests of Spartan Motors, provided that no amendment could impair any outstanding incentive award without the consent of the participant, except according to the terms of the Plan or the incentive award. No termination, amendment or modification could become effective with respect to any incentive award outstanding under the Plan without the prior written consent of the participant holding the award, unless the amendment or modification operated solely to the participant's benefit.

Effective Date of the Plan

          Subject to shareholder approval, the Plan would take effect on April 22, 2003, and, unless terminated earlier by the board of directors, no awards could be made under the Plan after April 21, 2013.

          If the Plan is not approved by the shareholders, no incentive awards will be made under the Plan to any director, officer or employee.

Section 162(m) of the Internal Revenue Code

          Section 162(m) of the Internal Revenue Code limits to $1 million the annual income tax deduction that a publicly held corporation may claim for compensation paid to its chief executive officer and to its four most highly compensated officers other than the chief executive officer. Qualified "performance-based" compensation is exempt from the $1 million limit and may be deducted even if other compensation exceeds $1 million. The proposed Plan is intended to provide performance-based compensation under Section 162(m) to permit compensation associated with stock options awarded under the Plan to be tax deductible to Spartan Motors while allowing, as nearly as practicable, the continuation of Spartan Motors' pre-existing practices with respect to the award of stock options. No participant in the Plan may be granted, in any calendar year, awards representing more than 125,000 shares of Spartan Motors common stock available for awards under the Plan.

Registration of Shares

          Spartan Motors intends to register shares covered by the Plan under the Securities Act of 1933 before any incentive award could be exercised or any restricted stock is granted.

          Your board of directors recommends that you vote FOR approval of the Stock Option and Restricted Stock Plan of 2003.

Amount and Nature of
Beneficial Ownership

Name and Address of
Beneficial Owner

Sole
Voting and
Dispositive
Power⁽¹⁾

Shared
Voting or
Dispositive
Power⁽²⁾

Total
Beneficial
Ownership⁽¹⁾⁽²⁾

Percent
of Class

George W. Sztykiel ⁽³⁾         

323,559

283,628

607,187

5.0

%

William F. Foster ⁽³⁾

1,037,317

--

1,037,317

8.5

Dimensional Fund Advisors Inc.
  1299 Ocean Avenue, 11th Floor
  Santa Monica, California 90401 ⁽⁴⁾

753,250

--

753,250

6.2

FMR Corp.
  82 Devonshire Street
  Boston, Massachusetts 02109 ⁽⁵⁾

604,780

--

604,780

5.0

Royce & Associates, LLC
  1414 Avenue of the Americas
  New York, New York 10019 ⁽⁶⁾

728,500

--

728,500

6.0

(1)

For Messrs. Sztykiel and Foster, these numbers include shares subject to options that are currently exercisable or that are exercisable within 60 days after April 7, 2003, granted under Spartan Motors' stock option plans. For Mr. Sztykiel, the number of shares subject to such options was 27,500 and for Mr. Foster the number of shares subject to such options was 122,500.

(2)

For Mr. Sztykiel, these numbers include shares over which he is entitled to share voting or dispositive power by reason of joint ownership, trust or other contract or property right, and shares held by spouses, children or other relatives over whom Mr. Sztykiel may have substantial influence by reason of relationship.

(3)

Based on information provided by each of these persons. Each such person's address is c/o Spartan Motors, Inc., 1165 Reynolds Road, Charlotte, Michigan 48813.

(4)

Based on information set forth in a Schedule 13G/A filed with the SEC on February 10, 2003. The Schedule 13G/A indicates that, as of December 31, 2002, Dimensional Fund Advisors Inc. was considered the beneficial owner of 753,250 shares of Spartan Motors common stock as a result of furnishing investment advice and serving as investment manager to various clients. The Schedule 13G/A indicates that, as of December 31, 2002, Dimensional had sole voting and dispositive power over 753,250 shares of Spartan Motors common stock.

(5)

Based on information set forth in a Schedule 13G filed with the SEC on February 14, 2003. The Schedule 13G indicates that, as of December 31, 2002, FMR Corp. was considered the beneficial owner of 604,780 shares of Spartan Motors common stock, over which it had both sole voting power and sole dispositive power.

(6)

Based on information set forth in a Schedule 13G filed with the SEC on February 5, 2003. The Schedule 13G indicates that, as of December 31, 2002, Royce & Associates, LLC was considered the beneficial owner of 728,500 shares of Spartan Motors common stock as a result of serving as an investment adviser to various clients. The Schedule 13G indicates that, as of December 31, 2002, Royce & Associates had sole voting and dispositive power over 728,500 shares of Spartan Motors common stock.

Amount and Nature of
Beneficial Ownership⁽¹⁾

Name of Beneficial Owner

Sole Voting
and Dispositive
Power⁽²⁾

Shared Voting
or Dispositive
Power⁽³⁾

Total
Beneficial
Ownership⁽²⁾⁽³⁾

Percent of
Class

John E. Sztykiel

152,146

187,405

339,551

2.8

%

William F. Foster

1,037,317

--

1,037,317

8.5

David R. Wilson

63,500

--

63,500

*

George Tesseris

83,000

1,000

84,000

*

Charles E. Nihart

69,750

--

69,750

*

Richard J. Schalter

31,763

225

31,988

*

Kenneth Kaczmarek

0

0

0

*

James W. Knapp

10,500

0

10,500

*

James L. Logan

42,827

0

42,827

*

All directors and named persons
    as a group (9 persons)         

1,490,803

188,630

1,679,433

13.3

%

(1)

The number of shares stated is based on information provided by each person listed and includes shares personally owned of record by the person and shares which, under applicable regulations, are considered to be otherwise beneficially owned by the person.

(2)

These numbers include shares held directly and shares subject to options that are currently exercisable or that are exercisable within 60 days after April 7, 2003, that were awarded under Spartan Motors' 1984 and 1994 Incentive Stock Option Plans, our 1988 Non-Qualified Stock Option Plan or our Stock Option and Restricted Stock Plan of 1998. The number of shares subject to such stock options for each listed person is shown below:

John E. Sztykiel

132,500

William F. Foster

122,500

David R. Wilson

53,500

George Tesseris

65,000

Charles E. Nihart

65,000

Richard J. Schalter

27,500

Kenneth Kaczmarek

0

James W. Knapp

10,500

James L. Logan

37,500

All directors and executive officers as a group

514,000

(3)

These numbers include shares over which the listed person is legally entitled to share voting or dispositive power by reason of joint ownership, trust or other contract or property right, and shares held by spouses, children or other relatives over whom the listed person may have substantial influence by reason of relationship.

          Spartan Motors' board of directors currently consists of seven directors. The board of directors is divided into three classes, with each class as nearly equal in number as possible. Each class of directors serves a successive three-year term.

          Biographical information concerning Spartan Motors' directors, executive officers and persons who are nominated for election to the board of directors is presented below.

Nominees for Election as Directors to Terms Expiring in 2006

          John E. Sztykiel (age 46) has been a director since 1988. Mr. Sztykiel has been Spartan Motors' President since December 1992 and Chief Executive Officer since June 2002. He was our Chief Operating Officer from December 1992 to June 2002. Mr. Sztykiel previously served as the Executive Vice President and Vice President of Sales of Spartan Motors from 1989 to 1990. From 1985 to 1989,

he was our Director of Marketing - Diversified Products Group.

          Charles E. Nihart (age 66) has been a director since 1984. Mr. Nihart, a certified public accountant consultant, established the certified public accounting firm of Nihart and Nihart, P.C., in 1972. The Lansing offices of Nihart and Nihart merged with Maner, Costerison and Ellis, P.C., C.P.A., on January 1, 1989. Mr. Nihart was affiliated with the firm on a consulting basis until 2001. Mr. Nihart is the former owner and President of AARO Rentals, Inc., of Lansing, Michigan, a rental company of heavy duty equipment, which he sold in 2000.

          Kenneth Kaczmarek (age 63) has been a director since 2003. Mr. Kaczmarek brings nearly four decades of automotive and heavy-truck industry experience to our board of directors. Prior to joining our board of directors, Mr. Kaczmarek was an independent consultant to the automotive industry from 1996 to 2000. From 1994 to 1996, Mr. Kaczmarek had various executive responsibilities, including service as

President of Volvo Truck Finance during its start-up phase. From 1981 to 1994, he was the Chief Financial Officer and Executive Vice President of Finance of Volvo GM Heavy Truck Corporation.

Directors With Terms Expiring in 2004

          George Tesseris (age 71) has been a director since 1984. Mr. Tesseris has been a practicing partner with the law firm of Tesseris, P.C. (formerly Tesseris and Crown, P.C.) since 1981. From 1972 to 1981, Mr. Tesseris was a partner in the law firm of Church, Wyble, Kritselis and Tesseris.

          David R. Wilson (age 67) has been a director since 1996 and Chairman of the Board since June 2002. Since 1993, Mr. Wilson has been an independent consultant to the automotive and commercial vehicle industry. From 1982 to 1993, Mr. Wilson was Vice President of Volvo GM Heavy Duty Truck Corporation and from 1979 to 1982, Mr. Wilson served as general manager of field operations for Mercedes Benz of North America.

Directors With Terms Expiring in 2005

          William F. Foster (age 61) has been a director since 1978. Mr. Foster, a firefighter for approximately 30 years, is a founder of Spartan Motors and has served as its Vice President since 1976. From 1965 to 1975, Mr. Foster served as a designer draftsman for Diamond Reo Trucks, Inc.

          Richard J. Schalter (age 49) has been a director since August 1999. Mr. Schalter, a certified public accountant, has served as Executive Vice President since August 2000. From November 1996 to July 2002, he served as Chief Financial Officer, as well as Secretary and Treasurer. From June 1989 until November 1996, Mr. Schalter served as Treasurer and Director of Finance and Administration of Great Lakes Hybrids, an international distributor and subsidiary of KWS a.g. From March 1986 to June 1989, Mr. Schalter served as Treasurer and financial administrator for Martin Systems, Inc., a worldwide supplier of electrical controls and machine operating systems.

Executive Officers Who Are Not Directors

          James W. Knapp (age 57) has been our Chief Financial Officer, Secretary and Treasurer since July 2002. Mr. Knapp has a background that includes more than three decades in finance, operations and information systems. Prior to joining Spartan Motors, he served as Chief Financial Officer of G&T Industries, a privately held manufacturing and distribution firm, from 1997 to January 2002. He was an independent consultant from January 2002 through June 2002. He also served for eight years with Smiths Industries, a publicly traded London-based manufacturer of aerospace, medical and industrial products, in the positions of Vice President of Finance and Information Technology and, earlier, Vice President of Finance and Administration for the Grand Rapids, Michigan division. Additionally, he spent 10 years with Herman Miller, Inc., a publicly traded office furniture manufacturer.

          Spartan Motors' board of directors held 11 meetings during 2002. Each incumbent director attended at least 75% of the aggregate of (1) the total number of board of directors meetings and (2) the total number of meetings held by all committees of the board of directors

on which he served (held during the periods that he served on the board and on such committees).

          The board of directors has the following standing committees:

          Audit Committee. The Audit Committee is responsible for the following activities:

• selecting the independent auditors;



• reviewing and approving the scope of the yearly audit plan and proposed budget for audit fees;



• reviewing the results of the annual audit with the independent auditors;



• reviewing Spartan Motors' internal controls with the independent auditors;



• reviewing and approving audit and permitted non-audit services to be performed by the independent auditors; and



• reporting to the board of directors on the Audit Committee's activities and findings and making recommendations to the board of directors on these findings.

          Spartan Motors believes that all of the members of the Audit Committee are "independent," as that term is defined in Rule 4200 of the Marketplace Rules of the Nasdaq Stock Market. Spartan Motors' board of directors has adopted a written charter for the Audit Committee, a copy of which was included with our proxy statement for the 2001 annual meeting of shareholders.

          Messrs. Nihart (Chairman), Tesseris, Wilson and, since February 2003, Mr. Kaczmarek are members of the Audit Committee. The Audit Committee met three times during 2002.

          Compensation Committee. The responsibilities of the Compensation Committee include:

• recommending the cash and other incentive compensation, if any, to be paid to Spartan Motors' executive officers;

• reviewing and making recommendations to the board of directors regarding stock options awarded under Spartan Motors' stock option plans; and



• reviewing all material proposed option plan changes.

          The Compensation Committee also determines the employees to whom options will be granted, the number of shares covered by each option, the exercise price of each option and other matters associated with option awards.

          Messrs. Tesseris (Chairman), Nihart and Wilson are members of the Compensation Committee. The Compensation Committee met three times during 2002.

          Nominating Committee. The Nominating Committee develops and recommends to Spartan Motors' board of directors criteria for the selection of candidates for director, seeks out and receives suggestions concerning possible candidates, reviews and evaluates the qualifications of possible candidates and recommends to the board of directors candidates for vacancies occurring from time to time and for the slate of directors to be proposed on behalf of the board of directors at each annual meeting of shareholders.

          David Wilson (Chairman), John Sztykiel and William Foster are members of the Nominating Committee. The Nominating Committee met three times during 2002.

          Shareholder Nominations of Directors. The Nominating Committee will consider nominees for election to the board of directors submitted by shareholders. Spartan Motors' bylaws provide that any shareholder entitled to vote generally in the election of directors may nominate one or more persons for election as directors at a meeting only if written notice of the shareholder's intent to make a nomination or nominations has been given to Spartan Motors' Secretary at least 120 days before the date of notice of the meeting if the meeting is an annual meeting, and not more than seven days following the date of notice of the meeting if the

meeting is a special meeting at which directors will be elected.

          Each such notice to the Secretary must include:

• the name, age, business address and residence of each nominee proposed in the notice;



• the principal occupation or employment of each nominee;

• the number of shares of capital stock of Spartan Motors that each nominee beneficially owns;



• a statement that each nominee is willing to be nominated; and



• such other information concerning each nominee as would be required under the rules of the Securities and Exchange Commission in a proxy statement soliciting proxies for the election of such nominees.

Annual
Compensation

Long-Term
Compensation
Awards

Name and Principal Position

Year

Salary⁽¹⁾

Bonus⁽²⁾

Number of
Securities
Underlying
Options

All Other
Compensation⁽³⁾

George W. Sztykiel⁽⁴⁾
Chief Executive Officer

2002
2001
2000

$

75,226
135,014
132,185

$

113,401
77,899
69,519

0
12,500
12,500

$

2,154
2,875
2,803

John E. Sztykiel⁽⁴⁾
President, Chief Executive
  Officer and Director

2002
2001
2000

$

182,152
164,258
163,854

$

281,332
107,371
101,895

20,000
15,000
15,000

$

2,202
2,988
3,257

Richard J. Schalter
Executive Vice President and
  Director

2002
2001
2000

$

163,331
148,331
137,018

$

233,901
85,943
69,726

15,000
12,500
12,500

$

1,357
1,792
2,505

William F. Foster
  Vice President and Director

2002
2001
2000

$

94,745
88,161
80,129

$

61,324
29,757
19,157

12,500
12,500
12,500

$

1,396
1,630
1,674

James W. Knapp⁽⁵⁾
Chief Financial Officer,
  Secretary and Treasurer

2002

$

59,500

$

79,372

10,500

$

       0

James L. Logan
Vice President of Engineering,
  Spartan Motors Chassis

2002
2001
2000

$

131,000
120,165
114,655

$

131,171
63,463
47,696

7,500
7,500
7,500

$

1,788
2,010
2,263

(1)

Includes director fees paid by Spartan Motors. See "Compensation of Directors" on page 19.

(2)

Includes payments under (1) our Quarterly Bonus Program, in which all employees of Spartan Motors participate, and (2) our Spartan Profit and Return Management Incentive Bonus Plan, which is described in "Compensation Committee Report on Executive Compensation-Annual Bonuses" on page 21.

(3)

Consists solely of Spartan Motors' contribution to its profit-sharing plans.

(4)

George Sztykiel stepped down as Chief Executive Officer of Spartan Motors after the 2002 annual meeting of shareholders, which was held on June 11, 2002 (at which point John Sztykiel became CEO). Accordingly, amounts reported as George Sztykiel's salary for 2002 represent only approximately 6.5 months of salary.

(5)

Mr. Knapp joined Spartan Motors in July 2002. Accordingly, amounts reported as his salary for 2002 represent only approximately six months of salary.

Individual Grants

Number of
Securities
Underlying

Percent
of Total
Options
Granted to

Exercise
Price

Potential Realizable
Value at Assumed
Annual Rates of Stock
Price Appreciation
for Option Term

Name

Options
Granted⁽¹⁾

Employees in
Fiscal Year

Per
Share

Expiration
Date

0%

5%

10%

George W. Sztykiel

0

0

%

N/A

N/A

--

N/A

N/A

John E. Sztykiel

20,000

4.3

$11.38

12/30/2012

--

$143,136

$362,736

Richard J. Schalter

15,000

3.2

11.38

12/30/2012

--

107,532

272,052

William F. Foster

12,500

2.7

11.38

12/30/2012

--

89,460

226,710

James W. Knapp

3,000
7,500

0.7
1.6

15.30
11.38

7/8/2012
12/30/2012

--
- --

28,866
53,676

73,153
136,026

James L. Logan

7,500

1.6

11.38

12/13/2012

--

53,676

136,026

(1)

On December 31, 2002, Spartan Motors granted options to purchase shares of Spartan Motors common stock over a 10-year period (Mr. Knapp also received an option grant in July 2002, as shown above.) Exercise prices of stock options are determined by the Compensation Committee and were equal to the fair market value of Spartan Motors' common stock on the date of grant. (On December 31, 2002, the closing price of Spartan Motors' common stock, as reported on Nasdaq, was $11.38 per share). Options are immediately exercisable. Options terminate, subject to certain limited exercise provisions, in the event of death or termination of employment or directorship. With respect to options granted under the Stock Option and Restricted Stock Plan of 1998, the compensation committee may include provisions in the stock option agreement or certificate of award that provide that if a change in control (as defined in that plan) of Spartan Motors occurs, then the stock option will immediately vest or, alternatively, the option holder would receive cash in lieu of the options.

Number of Securities
Underlying Unexercised
Options at Fiscal Year-End

Value of Unexercised
In-the-Money Options at
Fiscal Year-End ⁽¹⁾

Name

Shares
Acquired
on Exercise

Value
Realized

Exercisable

Unexercisable

Exercisable

Unexercisable

George W. Sztykiel

62,500

$416,488

27,500

--

$ 96,575

--

John E. Sztykiel

25,000

207,988

132,500

--

368,530

--

Richard J. Schalter

45,000

249,445

27,500

--

49,125

--

William F. Foster

--

--

122,500

--

441,975

--

James W. Knapp

--

--

10,500

--

0

--

James L. Logan

7,000

42,535

37,500

--

190,830

--

(1)

An option is considered "in the money" for purposes of this table if its exercise price was lower than the market value of Spartan Motors' common stock as of December 31, 2002 ($11.38 per share).

Plan Category

Number of securities to
be issued upon exercise
of outstanding options,
warrants and rights
(a)

Weighted-average
exercise price of
outstanding options,
warrants and rights
(b)

Number of securities
remaining available for
future issuance under
equity compensation
plans (excluding
securities reflected in
column (a))
(c)

Equity compensation plans
   approved by security
   holders (1)

1,900,930

$8.57

211,785

(4)

Equity compensation plans
   not approved by security
   holders (2)

 
 
0

 
 
- --

 
 
25,000

Total (3)

1,900,930

$8.57

236,785

(4)

          The Compensation Committee of the board of directors develops and recommends to the board of directors Spartan Motors' executive compensation policies. The Compensation Committee also administers Spartan Motors' executive compensation program and recommends for approval to the board of directors the compensation to be paid to the Chief Executive Officer and other executive officers. The Compensation Committee consists of three directors, none of whom is a current or former employee of Spartan Motors.

Compensation Philosophy

          The Compensation Committee's executive compensation philosophy is to provide competitive levels of compensation as well as incentives to achieve superior financial performance. The Compensation Committee's policies are designed to achieve the following five primary objectives:

• integrate management's compensation with the achievement of Spartan Motors' annual and long-term performance goals;



• reward excellent corporate performance;



• recognize individual initiative and achievement;



• attract and retain qualified management; and



• align the interests of management with those of shareholders to encourage achievement of continuing increases in shareholder value.

The Compensation Committee sets management compensation at levels that the Compensation Committee believes are consistent with other companies in Spartan Motors' industry.

          Executive compensation consists of both cash and equity, and includes:

• base salary;



• profit-sharing incentive bonus; and



• long-term incentives through participation in stock option plans.

In addition, Spartan Motors provides various benefits to its employees, including Spartan Motors' executive officers.

          Section 162(m) of the Internal Revenue Code provides that publicly held corporations may not deduct compensation paid to the named executive officers in excess of $1 million annually, with some exceptions. We have examined our executive compensation policies in light of Section 162(m) and the regulations under that section. We do not expect that any portion of Spartan Motors' deduction for employee remuneration will be disallowed in 2003 or in future years by reason of awards granted in 2003.

Base Salary

          To attract and retain well qualified executives, the Compensation Committee's policy is to establish base salaries at levels and provide benefit packages that are considered to be competitive. Base salaries for executive officers are determined initially by evaluating the responsibilities of the position and the experience of the individual, and by reference to the competitive marketplace for management talent, including a comparison of base salaries for comparable positions at companies in similar industries. Some of the companies used for this comparison are included in the indices used in the stock price performance graph presented in this proxy statement (see pages 23 to 24).

          The Compensation Committee believes that base salaries should approximate the mid-

point of the range of salaries paid for similar positions by companies in similar industries. The Compensation Committee may recommend adjustments on a periodic basis to maintain the desired levels of base salaries for Spartan Motors' executives.

          The Compensation Committee determines annual salary adjustments by evaluating the competitive marketplace and the performance of Spartan Motors and the executive officer, as well as any increased responsibilities assumed by the executive officer. Salary adjustments generally are determined and implemented on a 12-month cycle.

Annual Bonuses

          The Compensation Committee selects members of management to participate in Spartan Motors' incentive bonus program. The Compensation Committee considers several factors in determining the annual incentive bonus, if any, paid to management, including achievement of Spartan Motors' strategic and operating goals and an individual's achievement of personal goals. In addition, the Compensation Committee considers factors such as net earnings per share, revenues, return on assets and return on equity.

          In 2001, the board of directors adopted the Spartan Motors, Inc. Spartan Profit and Return Plan (the "SPAR Plan"). The SPAR Plan is intended to provide management with incentives to choose strategies and investments that maximize shareholder value, utilize a financial measurement consistent with the market's evaluation of Spartan Motors' performance and communicate Spartan Motors' financial objectives in a clear and quantifiable manner. Participants in the SPAR Plan include key management personnel and other persons that are included upon the recommendation of the President of Spartan Motors and the approval of the Chairman of the Board. The Compensation Committee is responsible for annually reviewing the provisions of the SPAR Plan and approving all payouts under it.

          Amounts payable under the SPAR Plan are based on the achievement of a target amount for Spartan Motors' net operating profit after tax for a given year, less a capital charge. This amount is known as the "SPAR amount." Each participant's bonus is determined by multiplying (1) his or her "target bonus percentage" (which is determined separately for different categories of employees) by (2) the SPAR multiple by (3) the participant's annual salary. The "SPAR multiple" is a fraction of the SPAR amount. For example, if Spartan Motors' net operating profit after tax for a given year, less the capital charge, was exactly equal to the applicable SPAR amount, then the SPAR multiple would be 1 for that year. The SPAR multiple is computed to one decimal. In addition, the SPAR Plan provides that participants may earn additional individualized bonuses based on the achievement of certain mutually agreed-upon personal objectives.

          The SPAR Plan generally requires that 25% of the amount that would otherwise be payable to a participant for a given year be "banked" (although individualized bonuses are not subject to banking). Amounts that are banked may be paid in future years but are subject to forfeiture in accordance with the terms of the SPAR Plan. Amounts that are banked accrue interest under the SPAR Plan.

Stock Option Plans

          Spartan Motors currently grants stock options under its 1994 Incentive Stock Option Plan and its Stock Option and Restricted Stock Plan of 1998. Spartan Motors' stock option plans allow officers and employees to purchase common stock of Spartan Motors at a price established on the date of grant. Options granted under the Stock Option and Restricted Stock Plan of 1998 to non-employee directors must have an exercise price equal to at least 85% of the fair market value of Spartan Motors common stock on the date of grant. Incentive stock options granted under the 1994 Incentive Stock Option Plan or the Stock Option and Restricted Stock Plan of 1998 must have an exercise price equal to at least 100% of the fair market value on the date of grant. The Compensation

Committee administers all aspects of the plans and reviews, modifies (to the extent appropriate) and approves management's recommendations for awards.

          Absent unusual circumstances, the Compensation Committee historically has granted stock options on an annual basis to officers, employees and directors who are employees of Spartan Motors and on a biannual basis to directors who are not employees of Spartan Motors. (See "Compensation of Directors" on page 19.) Spartan Motors' stock option plans are designed to encourage long-term investment in Spartan Motors by participating executives and employees, more closely align executive and shareholder interests and reward executive officers and other employees for building shareholder value. The Compensation Committee believes stock ownership by management and other employees is beneficial.

          In determining the number of options to be awarded to an officer or employee, the Compensation Committee takes into consideration the levels of responsibility and compensation of the individual. The Compensation Committee also considers the recommendations of management (other than awards to the Chief Executive Officer), the individual performance of the officer or employee and the number of shares or other compensation awarded to officers or employees in similar positions at other companies. Generally, both the number of options granted and their proportion relative to the total number of options granted increase corresponding to the level of a participant's responsibility. Although the Compensation Committee also may consider the number of options already held by an officer or employee, the Compensation Committee does

not consider this factor to be particularly important in determining the amounts of awards.

Chief Executive Officer

          The Chief Executive Officer's compensation is based on the policies and objectives outlined above for all executive officers. Mr. John Sztykiel's base salary in 2002 was approximately 9.3% above his 2001 salary, which in part represents the fact that he was promoted to the position of CEO. John Sztykiel's annual incentive bonus award for 2002 was $281,332, which includes Spartan Motors' quarterly bonus program and his annual incentive bonus under the SPAR Plan. During 2002, John Sztykiel was awarded options to purchase 20,000 shares of Spartan Motors common stock.

          Mr. George Sztykiel's salary during the six and a half months that he served as CEO during 2002 was largely unchanged from 2001, and George Sztykiel was not granted any stock options in 2002. In 2002, George Sztykiel was awarded a $113,401 bonus under Spartan Motors' bonus plans.

Board Approval

          All recommendations of the Compensation Committee attributable to 2002 compensation were unanimous and were approved and adopted by the board of directors without modification.

Respectfully submitted,

George Tesseris, Chairman
Charles E. Nihart
David R. Wilson

          The Audit Committee reviews and supervises on behalf of the board of directors Spartan Motors' procedures for recording and reporting the financial results of its operations. Spartan Motors' management has primary responsibility for the financial statements and the reporting process, including the systems of internal controls. As part of its supervisory duties, the Audit Committee has reviewed Spartan Motors' audited financial statements for the year ended December 31, 2002, and has discussed those financial statements with Spartan Motors' management.

          The Audit Committee has also discussed with Spartan Motors' independent auditors, who are responsible for expressing an opinion on the conformity of those financial statements with generally accepted accounting principles, the judgments of the independent auditors concerning the quality of Spartan Motors' accounting principles and such other matters that are required under applicable rules, regulations, generally accepted accounting principles or generally accepted auditing standards to be discussed with the independent auditors. In

addition, the Audit Committee has received from the independent auditors the written disclosures required by the Independence Standards Board and has discussed their independence from Spartan Motors and Spartan Motors' management with them, including a consideration of the compatibility of non-audit services with their independence.

          After and in reliance upon the reviews and discussions described above, the Audit Committee recommended to Spartan Motors' board of directors that the audited financial statements for the year ended December 31, 2002 be included in Spartan Motors' Annual Report on Form 10-K for the year ended December 31, 2002.

Respectfully submitted,

Charles E. Nihart, Chairman
George Tesseris
David R. Wilson
Kenneth Kaczmarek

          The following graph compares the cumulative total shareholder return on Spartan Motors' common stock to the CRSP Total Return Index for The Nasdaq Stock Market ("CRSP NASDAQ") and the CRSP Total Return Index for Trucking and Transportation Stocks reported on The Nasdaq Stock Market ("CRSP T&T"), over a five-year period ended December 31, 2002, using December 31, 1997 as the starting point. The CRSP NASDAQ is a broad-based equity market index developed by the Center for Research

in Security Prices at the University of Chicago. The CRSP T&T is comprised of companies with a market capitalization similar to that of Spartan Motors and also is developed by the Center for Research in Security Prices. The CRSP NASDAQ index and CRSP T&T index both assume dividend reinvestment.

          Cumulative total shareholder return is measured by dividing (1) the sum of: (a) the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and (b) the difference between the share price at the end and the beginning of the measurement period, by (2) the share price at the beginning of the measurement period.

DECEMBER 31

SPARTAN
MOTORS

CRSP NASDAQ

CRSP T&T

1997

$ 100.00

$ 100.00

$ 100.00

1998

93.84

140.99

90.36

1999

72.27

261.48

86.11

2000

28.35

157.42

78.27

2001

109.39

124.89

92.56

2002

196.91

86.34

94.20

Proposal to Ratify Appointment of Ernst & Young LLP as Spartan Motors' Independent Auditors for the Current Fiscal Year

          Subject to the approval of shareholders, Spartan Motors has appointed Ernst & Young LLP as its independent auditors for its 2003 fiscal year. Representatives of Ernst & Young LLP are expected to be present at the annual meeting, will have the opportunity to make a statement if they desire to do so and are expected to be available to respond to appropriate questions from shareholders.

          Your board of directors recommends that you vote FOR ratification of the appointment of Ernst & Young LLP.

Ernst & Young's Fees

          Audit Fees. Ernst & Young billed Spartan Motors a total of $175,000 for its professional services rendered in connection with the audit of Spartan Motors' 2002 annual financial statements and for reviews of the financial statements included in Spartan Motors' Quarterly Reports on Form 10-Q for the quarters ended March 31, 2002, June 30, 2002 and September 30, 2002.

          Financial Information Systems Design and Implementation Fees. No related fees were billed by Ernst & Young during 2002.

          All Other Fees. Spartan Motors paid to Ernst & Young $307,930 during 2002 for services provided by Ernst & Young other than the services described above. These fees were for tax preparation services, tax consulting services and professional services rendered in connection with the audit of the Spartan Motors, Inc. Profit Sharing Plan.

          Section 16(a) of the Securities Exchange Act of 1934 requires Spartan Motors' directors and officers and persons who beneficially own more than 10% of the outstanding shares of our common stock to file reports of ownership and changes in ownership of shares of common stock with the Securities and Exchange Commission. Directors, officers and greater than 10% beneficial owners are required by SEC regulations to furnish us with copies of all Section 16(a) reports they file with the SEC. Based solely on our review of the copies of such reports that we received, or written representations from certain reporting persons that no reports on Form 5 were required for

those persons for the 2002 fiscal year, we believe that our directors and officers complied with all applicable Section 16(a) filing requirements during 2002, except that Messrs. Wilson, Nihart and Tesseris were each late in filing one Form 4 to report option grants that they automatically received on December 31, 2002 pursuant to the terms of the Spartan Motors, Inc. Stock Option and Restricted Stock Plan of 1998. Also, Mr. Schalter was late in filing a Form 4 to report (1) three purchases of Spartan Motors common stock by his children in February 2002 and (2) two transactions in April 2002.

          Shareholder proposals intended to be presented at the annual meeting of shareholders in the year 2004 and that a shareholder would like to have included in the proxy statement and form of proxy relating to that meeting must be received by Spartan Motors for consideration not later than January 1, 2004 to be considered for inclusion in the proxy statement and form of

proxy relating to that meeting. Such proposals of shareholders should be made in accordance with Rule 14a-8 under the Securities Exchange Act of 1934. All other proposals of shareholders that are intended to be presented at the annual meeting in the year 2004 must be received by Spartan Motors not later than March 16, 2004 or they will be considered untimely.

          We will initially solicit proxies by mail. In addition, directors, officers and employees of Spartan Motors and its subsidiaries may solicit proxies by telephone or facsimile or in person without additional compensation. Proxies may be solicited by nominees and other fiduciaries who may mail materials to or otherwise communicate with the beneficial owners of shares held by them. Spartan Motors will bear

all costs of the preparation and solicitation of proxies, including the charges and expenses of brokerage firms, banks, trustees or other nominees for forwarding proxy material to beneficial owners. In addition, we have engaged Georgeson Shareholder Communications Inc., at an estimated cost of $5,500 plus expenses and disbursements, to assist us in the solicitation of proxies.

PROXY

SPARTAN MOTORS, INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD MAY 28, 2003

PROXY