Aussie car mover Autocare Services has entered into voluntary administration as volatile market conditions and low sales of new cars put enormous pressure on the businesses' bottom line.
Autocare Services specialise in shore-to-door vehicle delivery, which boils down to storing and distributing new cars to dealers, corporate clients and leasing companies.
The business employs almost 600 Aussies across 20 sites.
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"Autocare Services has been a major player in Australia's automotive industry for 60 years, with almost 600 employees currently working at 20 sites across Australia to deliver vehicle logistics services for its customers," Autocare Services said in a statement.
"The business has been exposed to the automotive industry market downturn for three consecutive years now and vehicle volumes are not forecast to return to levels that can sustain the business in its current structure."
Autocare Services Pty Ltd is a wholly owned subsidiary of LINX Cargo Care Group, which employs 3,400 people across Australia and New Zealand.
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Christopher Hill, Joseph Hansell and Ross Blakeley of FTI Consulting have been appointed as the administrators.
During the administration process, Autocare Services said it intends to continue operating and servicing its many customers across Australia.
LINX Cargo Care Group's Chief Executive Officer, Anthony Jones, said Autocare Services continues to be significantly impacted by the vehicle logistics market decline.
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"Autocare Services has been working closely with its customers, and the wider supply chain, to evolve the business in alignment with the changing market conditions however, the material movement and volatility has been heightened by the ongoing COVID-19 pandemic," said Jones.
"Voluntary administration can provide Autocare Services with a pathway for the tough, but necessary, change it needs for the evolution of its business model to keep delivering services valued by customers today, and into the future, to the Australian automotive industry."
He said Autocare's financial difficulties do not reflect on the financial position of LINX Group, which is currently sound.
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