MECHANICS have expressed their shock at the sudden closure of a chain of popular used car dealers.
The used car market is growing in popularity as prices for new vehicles skyrocket, but critical problems are hurting companies.
Supply chain issues lead to lower inventories on dealers’ lots, causing dealers to raise prices to stay afloat.
Interestingly, the used car market faces the same problems as new car dealers.
As demand for used cars increases, inventory levels fall – which, like new car dealers, means higher prices.
Despite selling over 300,000 cars and leading the industry, off-lease only dealers have closed, citing bankruptcy as the cause.
“Off Lease Only is ceasing operations and is closed to the public,” Off-Lease Only wrote on its website.
“In order to responsibly cease operations, we have filed for voluntary protection under Chapter 11 of the U.S. Bankruptcy Code.”
The closure of five locations across Florida cost the region more than 400 jobs, portending a bleak future for used car dealers across the country.
“I’m really surprised to hear this because I thought they had the market cornered,” Brian Cone, a certified master mechanic at a new car dealer, told WPTV.
“Because they always seemed to have the largest inventory of used cars, and the price was pretty much unbeatable.”
Cone and his younger brother were Off-Lease Only customers four times.
He said pricing and inventory were important factors that kept them coming back to customers.
“It’s just the price and the pricing up front, and the inventory is really good too,” Cone said.
“So if you’re looking at a car that doesn’t have any interior lights, no paint, or anything like that, they usually have something you can look at.”
Jorge Neyra, a manager at Car Solutions near an off-lease-only parking lot, told WPTV he was “definitely surprised” since his neighbor is an “icon” in the used car market.
Inflation and supply chain issues were listed as the two main factors behind the company’s decision to file for bankruptcy and close locations.
The dealership said the decline in new car production had a direct impact on used car numbers.
Off-Lease Only management said the company’s assets and liabilities ranged from $100 million to $500 million.