AutoNation, different public vendor teams furlough 1000’s of staff because of coronavirus
An AutoNation location in Cerritos, California
Rick Loomis | Los Angeles Instances | Getty Photos
Automotive retailers are chopping government pay and shedding or furloughing 1000’s of staff as U.S. auto gross sales plummet amid the coronavirus pandemic.
AutoNation, the nation’s largest U.S. auto dealership chain, is furloughing 7,000 workers, slashing government pay and suspending greater than $50 million of capital spending as its year-over-year gross sales declined by about 50% final month, in accordance with a Friday submitting with the U.S. Securities and Alternate Fee.
Shares of AutoNation had been down 2.7% in the course of the remaining hour of buying and selling to $24.53. The inventory is down 49.7% this 12 months.
The corporate, as automakers did earlier within the week, cited “shelter-in-place” or “stay-at-home” orders from federal, state, and native governments as causes for the decline in gross sales: “The COVID-19 pandemic has adversely impacted, and is predicted to proceed to adversely impression, AutoNation’s operations,” AutoNation stated within the SEC submitting.
J.D. Energy earlier within the week forecast retail gross sales this month to say no by about 80% in contrast with April 2019 because of stay-at-home orders and COVID-19′s total impression on the financial system and client confidence. Retail gross sales don’t embody gross sales to fleet prospects equivalent to the federal government or companies.
AutoNation stated it at the moment has about $1.1 billion of liquidity, together with greater than $400 million of money and about $700 million in its revolving credit score facility. The corporate employs 26,000 folks at greater than 300 places in 18 states, in accordance with its web site.
AutoNation’s actions comply with related cuts from different publicly traded auto retailers.
Penske Automotive Group introduced Monday that it could minimize government pay, postpone $150 million in capital spending and conduct an undisclosed variety of “staffing-level changes.”
Group 1 Automotive final week stated it could scale back government salaries and furlough 3,000 U.S. workers for a 30-day interval with an possibility for a second 30-day interval because of “the sudden dramatic lower in enterprise actions and the unsure period of this decline.”
Shares of Group 1 had been down about 6.6% in the course of the remaining hour of buying and selling on Friday to $35.48. Shares of Penske had been down 6.7% to $22.89.