PriyaPatelVroom, the online car sales platform, is winding down its eCommerce operations and discontinuing its used vehicle dealership business in order to focus on its other ventures, including automotive finance company United Auto Credit Corp. (UACC) and CarStory, a provider of artificial intelligence (AI)-powered analytics and digital services for automotive retail. The move comes after Vroom was unable to raise additional capital and extend its vehicle floorplan facility. The company plans to lay off 800 employees and expects the wind-down to be largely implemented by March 31.
A Value Maximization Plan approved by Vroom’s board of directors outlines the steps the company will take to wind down its eCommerce operations, including suspending transactions through vroom.com, selling its current used vehicle inventory through wholesale channels, halting purchases of additional vehicles, and implementing a reduction-in-force. Vroom will focus on preserving liquidity and maximizing stakeholder value through its remaining businesses. Profitability has been challenging for online car platforms, with inventory aging and interest rates high. Vroom’s decision to exit car sales and focus on finance and AI services is a response to these challenges.
