A previous Kia dealer, which transferred its franchise to another group due to concerns over the expenses associated with refreshing its brand image, has entered administration.
Last year, Marsh Holdings Limited transitioned into a used car specialist after selling its Kia franchise to Howards during the summer.
The company also held motorcycle franchises for brands such as Harley Davidson in Plymouth and Southampton, Triumph in Plymouth, and Yamaha in Exeter.
Administrators from Westcotts Business Recovery in Exeter have been appointed.
A statement on the company’s used car website announced: ‘It is with great sadness that we must inform you that trading has ceased immediately.
‘Following a challenging period marked by economic uncertainty, adverse weather, excess supply and inventory from our manufacturing partners, along with the severe impact of recent budget announcements on businesses, we find ourselves in a position similar to many others, which is untenable.’
‘We assure you that every effort was made to avoid this outcome; however, this decision is necessary to minimize the impact on all affected parties.’
‘We acknowledge that many of you may have concerns or pending issues, and we want to assure you that we are doing everything possible to address these. We kindly request your patience as we work towards resolving these matters swiftly.’
In the message, gratitude was expressed to customers who had ‘become friends’ over the past 22 years for their support.
Financial records for the group, submitted at the end of September, revealed an operating loss of £852,399 last year.
Considering a £1.2m second payment from the sale of Kia Taunton, the group ultimately reported a profit of merely £27,526 for the year.
In their annual accounts, directors noted: ‘The group would have required significant investment in its Taunton premises in the short term to comply with [Kia’s] latest corporate identity standards.’
‘The directors assessed the required scope of work and estimated that over £750,000 would be necessary, not to mention the disruption to regular business operations during a three-month work period.
‘Considering the disturbance and inconvenience to our customers, along with the associated costs, the imminent 2030 targets, and evolving consumer trends over the past three years, the directors concluded that it was not in the group’s best interest, prompting efforts to sell the business.’
‘On August 4th, 2023, an asset sale was executed to Howards Group, resulting in the transfer of all staff under TUPE regulations. The transaction generated substantial cash, which aided in debt reduction.’
The directors also reported challenges with their Harley Davidson ventures due to ‘price increases’. The Exteer Yamaha store only opened at the end of 2023.
Looking ahead at that time, the company cautioned: ‘In the coming year, numerous economic challenges will arise. Ongoing media narratives around economic instability, heightened inflation, and persistently high interest rates are likely to impact consumer confidence and spending behaviors.
‘The directors remain cautiously optimistic about the future and will persist in being decisive, dynamic, and responsive in these fast-evolving and unprecedented times.’
The administrators can be reached at 01392 288555.
