Southeastern used-vehicle dealership chain US Auto Sales has closed 39 of its locations indefinitely, the company website said Tuesday.
A pop-up late Tuesday on usautosales.info said, “We have temporarily closed our dealerships and are working on a solution to reopen them as soon as possible.” “But don’t worry, we’re not going anywhere!”
The group, which works with car buyers regardless of credit history, told customers that its consumer auto loan service company USASF Servicing remained open for business and car payments.
A phone call to US Auto Sales was met with a similar recorded message: “Unfortunately, we have to temporarily close our dealership,” it began.
Reached by an American Auto Sales customer service representative automotive news Told no one was available to talk.
Financing for cars has become tougher as lenders tightened their underwriting standards for consumers who have spent far beyond their pandemic-era savings. Capital One recently announced that it is exiting its floorplan lending business to car dealerships, citing a “more challenging economic environment.”
US auto sales has routinely turned to the bond markets to raise money from investors, packaging subprime auto loans into bonds known as securitizations for sale to institutional investors. It most recently sold $233 million in bonds in June.
As more auto borrowers fall behind on payments, the loans within those bonds are performing poorly. Late last month, ratings agency Moody’s downgraded several tranches of bonds due in 2022 as well as those due in 2021, according to a March 2016 report by a unit tied to U.S. auto sales of the gross margin for the underlying debt pool. and restored the net loss data. Moody’s 31 report.
In 1992 in Lawrenceville, Ga. Founded in , US Auto Sales has 39 locations including Alabama, Florida, Georgia, North Carolina, South Carolina and Tennessee. The group had 459 vehicles till late Tuesday night.
The shutdown of US auto sales followed the abrupt closure of American Car Center, which Bloomberg said had more than 40 locations.
Bloomberg contributed to this report.
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