The automotive industry in the United States is going through difficult times. After a year of ups and downs, some of the sector's leading companies are struggling to stay afloat. The economic crisis, inflation, and high interest rates have left their mark on a market already affected by the pandemic.
One of the most affected companies has been a well-known vehicle repair chain, which has decided to take drastic measures. The company recently announced that it will close several of its stores due to a significant drop in its sales, reflecting the problems many automotive sector firms are facing.
A new restructuring plan to shine again
This is Monro Inc, which has announced that these closures are part of a broader new restructuring plan, led by the new CEO, Peter Fitzsimmons. The company seeks to improve its performance in several key areas, including customer experience and sales tactics.
Fitzsimmons highlighted that during his first weeks at the helm of the company, a thorough evaluation of the business was carried out. The result was the identification of four key areas for improvement: store closures, improving customer experience, acquiring new profitable customers, and increasing productivity.
The impact of store closures
Starting in the first quarter of fiscal year 2026, Monro Inc will begin closing 145 stores. This cut is expected to reduce about $45 million from its annual sales next year. The measure affects a company that currently operates 1,260 stores across the United States, in addition to 48 franchises.
Monro Inc isn't the only automotive company that has suffered major losses. Other large vehicle and tire repair companies have also been affected by the economic crisis. Inflation and high interest rates have been key factors in the decline in sales, especially after the Covid-19 pandemic.
Companies such as Wheel Pros, Accuride Corporation, and American Tire Distributors filed for bankruptcy in 2024, according to Chapter 11. The factors behind these collapses include the economic crisis, supply chain problems, and a decrease in demand for products and services.
The difficult situation of the industry
These massive closures not only affect the companies involved, but also reflect a complicated economic outlook for the automotive sector in general. Growth expectations have been reduced, and companies face rising costs along with dwindling demand.
Monro Inc. now faces a tough restructuring task in an attempt to regain its profitability. However, the future remains uncertain for many of the companies operating in the same sector.