AP Eagers Axes 1200 Staff..

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"Australia's largest car dealership group, AP Eagers, has axed 1200 staff and struck agreements with about 50 per cent of landlords at its 200 outlets for rent waivers or deferrals until June 30.
The company, which has 11 per cent of the new car market in Australia, outlined on Thursday that it has been aggressively cutting costs in response to the economic turmoil from the coronavirus pandemic, and a big downturn in vehicle sales.

As well as the staff cuts, AP Eagers has implemented a freeze on capital spending and cutbacks in advertising and marketing. AFR
AP Eagers chief executive Martin Ward said the company was trying to retain as many of the remaining 8200 employees in the business as possible, using a temporary rostering system for now.
It has applied for the federal government's JobKeeper scheme and is ''confident a large proportion of the workforce will be eligible''.
The company made 1200 people redundant across the business in mid-March, in a first wave of cost-cutting prior to the announcement of the JobKeeper scheme. But the details of the sackings were made public only on Thursday. AP Eagers shares jumped 20 per cent to $4.93 by 1pm AEST.


Mr Ward has also implemented a freeze on capital spending and cutbacks in advertising and marketing in a weak vehicle sales market.
Across the industry, new car sales slumped by 18 per cent in March, with the April fall expected to be even worse. The car dealer group in early April pushed for three months' free rent on its sites until June 30.
New finance facilities
The group said on Thursday that so far, a combination of waivers and deferrals had been agreed by landlords covering about 50 per cent of its lease commitments.
Bell Potter analyst Chris Savage said in a note on Thursday that the ''key take-out is the company looks to be well capitalised and there is no need for a capital raise''.
However, Mr Savage said there was ''little to gauge how trading has been over the past several weeks but the company looks to have been very proactive in managing and reducing its cost base''.
He said the 50 per cent reduction in lease costs over the next three months suggested a cost saving of $20 million, with annual operating leases across the company amounting to about $170 million.
Bell Potter has a $6 price target on the stock, and a ''buy'' rating.
AP Eagers also said on Thursday that the finance partners of new car manufacturers had agreed to $122 million of new finance facilities, delivering a lift to working capital.
The heavy cost-cutting comes a day after AP Eagers announced it would be taking a $25 million haircut on the price tag in the sale of the ailing refrigerated logistics business it inherited from Automotive Holdings Group. That business is now being sold to private equity firm Anchorage Capital for $75 million, instead of $100 million." https://www.afr.com/companies/transp...0200430-p54oj9

[hayseed]

They've had to take a $25 Million Haircut on the sale of the Logistics arm as well..

https://www.fullyloaded.com.au/indus...ics-sale-price

[prydey]

If it includes 2 staff members of a particular Zooper cars dealership in SA (a subsidiary of AP Eager) then it would be bad luck for them to lose their job but i certainly won't be shedding any tears over them.

Yes, i bought my territory from them, and while the car is a good car, they got exposed for being bare faced liars.

[littlered]

Old news to those in the industry... only recently published in the public domain

Basically anybody on probation (less than 6 months) was terminated with immediate effect to save cashflow

LR