A billion-dollar turnover has not been enough to save the business of the Swedish car dealer Mobilty Motors, which is now attempting a reconstruction.
The Swedish car dealership chain Mobility Motors is facing potential bankruptcy, even though the company has a turnover of 1.2 billion Swedish kronor, equivalent to 780 million Danish kronor.
Mobility Motors, which employs 120 people, has been forced to initiate a restructuring to try to save the company.
This is what Sydsvenskan writes.
Already in 2023, Mobility Motors recorded a deficit of 23 million Swedish kronor, and it is expected that 2024 will be another year with red numbers on the bottom line.
The company has a debt of 156 million Swedish kronor to banks, suppliers and the Danish Tax Agency.
Mobility Motors is an authorized dealer for a number of well-known car brands, including Mercedes-Benz, Hyundai and Mazda. They also offer service on a wide range of car brands. The company has branches in Lund, Malmo, Norrtälje and Stockholm.
A reconstruction means that the company must carry out extensive restructuring and that creditors may be forced to accept losses. According to Sydsvenskan, up to 60 employees could lose their jobs as a result of the planned reconstruction.
– Insolvency is usually associated with bankruptcy, but I would like to be clear that it is reconstruction that has begun.
– Regarding the reconstruction, the process formally began on January 8 of this year, resulting in approval from the High Court.
– All analyses and forecasts prior to the submission of the restructuring application have led to the conclusion that the business will be profitable again after the necessary measures are taken, writes marketing manager Nawar Saman in an email to Motorbranchen.
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According to Nawar Saman, the company's problems are due to a combination of negative market developments, inflation and high interest rates. Mobility Motors primarily sells cars to private customers, which has made them particularly vulnerable to the current economic challenges.
As part of the reconstruction, Mobility Motors plans to close branches in Malmo and Lund.
"Despite the fact that we have implemented extensive cost adjustments for a long period of time to address these difficulties, unfortunately this has not been enough to ensure long-term profitability," Nawar Saman tells Motorbranschen.
Mobility Motors' future remains uncertain, and it is still unknown whether the reconstruction will be sufficient to save the company from bankruptcy.
