Last week, Lithia Dodge of Sioux Falls and Lithia Chevrolet of Sioux Falls, both in Sioux Falls, S.D., were both sold to Billion Automotive, and Lithia Chrysler Jeep Dodge of La Crosse in La Crosse, Wis., was sold to Pischke Motors of La Crosse.
Net proceeds from the transactions and financing activities are approximately $101.2 million since the beginning of the year, with $22.5 million in the first quarter and the balance of $78.7 million since the beginning of the second quarter.
In addition to raising the above capital, the company has successfully reduced used vehicle inventory levels by approximately $50 million since the beginning of the third quarter. This strategy effectively reduces the floorplan obligations by the same amount.
“Six of the stores that we sold were in our bottom-ten performers. The successful steps we have taken to divest these stores demonstrates our ability to generate liquidity from even our most unprofitable stores. We have received goodwill from the sale of most of these stores,” says Sid DeBoer, CEO and chairman.
“Despite the turbulent economy, Lithia continues to successfully execute our restructuring plan. We have shifted our domestic/import brand mix closer to the levels we are targeting,” he says. “We have adjusted our geographic footprint, while raising capital and cutting costs. Moving forward with this plan will continue to strengthen our company and bring us into a stronger position to weather the current and future economic challenges.”
For more information, visit Lithia online.