ROGERS, Ark. (KNWA/KFTA) – Arkansas-based America’s Car-Mart will shut down 42 dealerships within the next week, according to a recent filing with the U.S. Securities and Exchange Commission.
Car-Mart CEO Doug Campbell addressed the closures in a letter dated Tuesday, April 7, sent to shareholders, employees, and customers. He said the company replaced its lending facility with a $300 million term loan, and its new loan operating system is “producing materially better credit outcomes.”
“At the same time, establishing the non-recourse revolving warehouse credit facility that would restore our origination capacity has taken longer than anticipated,” Campbell said. “This is not a singular Car-Mart decision — it requires alignment among multiple counterparties.”
Campbell noted that since the release of third-quarter earnings on March 12, “it has become increasingly clear that the path to resolution is less certain and may require an extended deadline, primarily driven by broader market conditions and factors largely outside our control.” In the third quarter, Car-Mart reported a loss of $76.71 million, or $9.25 per share, and closed 18 dealerships.
In Tuesday’s filing, Car-Mart said it will close 42 dealerships and reduce “the requisite support staff.”
The company operates 135 stores across Alabama, Arkansas, Georgia, Indiana, Iowa, Kentucky, Mississippi, Missouri, Oklahoma, Tennessee, and Texas.
“To be clear, this is a near-term liquidity challenge,” Campbell said in the letter. “Our approximately $1.5 billion finance receivables portfolio represents an asset base that management believes substantially exceeds our total recourse obligations, and we are taking these actions to protect that value for stakeholders.”
The company has not yet disclosed which specific locations will close.
Campbell said the locations slated for closure account for about 31% of the total store count but serve only 18% of customers.
“We did not make this decision lightly and are taking these steps because they are the right thing to do for the long-term health of this business,” he said.
Affected customer accounts will be transferred to nearby dealerships or managed by the company’s central team.
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