Carmax cuts costs with 600 layoffs

Carmax cuts costs with 600 layoffs

There are 48 comments on the Long Beach Press-Telegram story from Oct 1, 2008, titled Carmax cuts costs with 600 layoffs. In it, Long Beach Press-Telegram reports that:

CarMax Inc. said Wednesday it is laying off more than 600 employees, or about 4 percent of its total work force, as the auto retailer tries to cut costs due to a decline in car and truck sales.

Join the discussion below, or Read more at Long Beach Press-Telegram.

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laid off

Wake Forest, NC

#1 Oct 2, 2008
it really did happen. but they are cutting costs at the wrong end of the dying horse. their buyers are the reason they are in any financial trouble whatsoever. they insisted on buying huge gas guzzlers even as gas prices topped 4 dollars a gallon. as the people on the back lot were questioning them on why so many suv's they said they were getting them so cheap that they could make a huge margin on them. Well that just didnt happen and they spent all that money on vehicles they couldnt sell untill they lost several thousand each on them. But the working man on th eback lot is the one who cant get a job because his skills are so specialized to carmax reconditioning that there just is no market for them in the outside world. Thanks carmax for laying off the working man who actually adds something to the value of your cars and keeping all of the top heavy corporate staff who are salaried. just last year the ceo got a 850k a year raise. yippe thats a raise not his total income.
laid off 2

Albuquerque, NM

#2 Oct 2, 2008
I came to work wendsday morning only to have the supervisor greet me and had the nerve to say goodmorning. We couldnt even walk in the building. They had police there also. I guess there are some manics out there. I have to agree with the guy from Wake Forrest. These buyers kept buying all these hummers and surburbans when there isnt anybody buying them.. Instead of buying what was good for the company they bought cars trying to make a profit and now I dont have a job, But every one of them buyers still has there job. Thanks Alot
laid off 3

El Paso, TX

#3 Oct 8, 2008
carmax kept some of the worst techs and laid off some of the best. they said they cared about their employees but if they did they would have kept the ones that would help them through this difficult time not the ones who suck out every dime they can get . some were even trying to get fired for the unemployment and were kept . carmax was a good company with weak leadership . doing your job well and looking out for the company was seen as causing trouble .
buyer

Charlotte, NC

#4 Oct 8, 2008
I truly am sorry to all those who were laid off. But it was a necessary step for the survival of the company. The reconditioning techs were some of the highest paid store employees making anywhere from $50K-$110K. The Avg buyer makes less than $50K. Also buying the large SUV's was a great company decision. For the past 2 months large SUV's have been the best performing segment in our inventory. They are able to be purchased dirt cheap and make the best margin (and people are still in need of them)
CA Buyer

Atwater, CA

#5 Oct 28, 2008
You need to understand if you were laid off, it was because you were being paid MUCH MUCH higher than than market for what you were doing and we simple could not afford to any longer. Plane and simple. As any business class will tell you, its much wiser to lay off that force and re higher at a market rate than to do pay cuts (Because of moral and work ethic problems that will occur post pay cuts)

As for your insight to how unwise it was for us to purchase SUVs. Be glad your not running the company.... or else you would have been laid off long ago. Leave the financial decisions to us. Our ability to react so quickly to turn rates, market conditions and inventory positions is the only thing that has kept this company in the green thus far and in these horrible economic times is a VERY LARGE competitive advantage.
Mike

United States

#6 Oct 30, 2008
Techs make 50-110k a year because of schooling and we must buy tools. How much a year do you spend in tools Buyer?
santafromhell

Los Angeles, CA

#7 Oct 30, 2008
Mike wrote:
Techs make 50-110k a year because of schooling and we must buy tools. How much a year do you spend in tools Buyer?
If it makes you feel any better, the buyer's who are heckling you will be out of work soon enough.
A fiscal tsunami is coming. Carmax and other's are battening down the hatches, and praying to their gods.
Amex doesn't dump 7000 employees because they think good times are a year away. That's a lot of money for employee training down the tubes.
They do it because they see the big dark clouds on the horizon. Clouds of their own making.
Just save your money. Get liquid. Cut all unnecessary costs everywhere.
If Obama gets elected, you're going to see one heck of a market sleigh ride early next month and many, many tears before it's over.
madtech

Huntsville, AL

#8 Jan 26, 2009
What should have happend is the buyers get laid off cuz they dont know what the hell kind of cars they are buying and should have someone who KNOWS at least something about cars be a buyer you dam buyers dont even know what the hell your looking at when you get these cars from auctions or buying them from people off the street, ive kicked so many cars because of your stupid asses for missing obvious frame and core damage and you dont think thats not costing the company money???
Previous Tech

United States

#9 Feb 3, 2009
They can say what they want about laying off because of recon techs making too much money. It's just a bunch of whining managers and buyers who feel they deserve more but have no technical skills and don't understand what it takes to be good at actually fixing cars. As far as saving money money that's not happening because they hired outside vendors to recondition the cars. I currently work for one of these vendors trust me when I tell the cost per car has at least doubled I know the actual numbers. Only time will tell.
Consumer

Chicago, IL

#10 Feb 20, 2009
Thanks to the tough economy and Carmax's troubles, I just bought a fully-loaded, luxury package 2008 H3 HUMMER from a local Carmax at a DIRT CHEAP price. So much for the no-haggle policy. Walked in with a worthless trade and cash to buy...walked out with a HUMMER at MY no-haggle price. Good deals are out there right now for consumers. Thanks, buyers!!!
sales relations

Jacksonville, FL

#11 Feb 20, 2009
Granted now is the time to buy the gas guzzlers,
whether consumer or buyer, but not to invest all
your monies into them and diversify your stock.
you pay your department heads way too much money-
as most of them are not qualified even to wipe
their mouth-the sales people are out there trying their best to stay alive and keep the company alive, even these others that take what they get
for granted;yes the techs have to prove their abilities;time has proven that not promoting your
sales staff with increases and bonuses, but over indulging those that sit on their ass is how we got in this mess;the only good thing to say right
now is that CARMAX isn't alone in this.
previous tech

O Fallon, MO

#12 Sep 8, 2009
I was also layed off almost a year ago and do understand that it was neccesary to do this to survive, but how do you explain the high cost of sublet vendors that are doing the job today. Bottom line we had managers and execs that were pissed because we made too much and it was a pride thing. having worked at Carmax for more than 10 years, I know how Carmax operates and and also know that after the year contract is up with the major vendor is up( DW ), they will go back to the old way at a cheaper price and cheaper Quality.
FormerBuyer

Montclair, CA

#14 Sep 13, 2009
As a former Buyer, I would say the company shot itself in the foot by failing to invest in the talent they once had. I asked for a raise and Carrie Caldwell didn't think I was worth it. I left the company and most of the talented Buyers left also. We found better jobs and better paying jobs. Jobs where our employer recognized our talent. When we left, we left a great name of Carmax behind...and that name helped get us into our new jobs. It was perfect timing. Nowadays, though, the Carmax name doesn't mean anything. It's not a threat to local dealers and it doesn't pay well. I guess there is a price for everything. Good luck, guys! I would bail. You don't have the talent.
laid off wrote:
it really did happen. but they are cutting costs at the wrong end of the dying horse. their buyers are the reason they are in any financial trouble whatsoever. they insisted on buying huge gas guzzlers even as gas prices topped 4 dollars a gallon. as the people on the back lot were questioning them on why so many suv's they said they were getting them so cheap that they could make a huge margin on them. Well that just didnt happen and they spent all that money on vehicles they couldnt sell untill they lost several thousand each on them. But the working man on th eback lot is the one who cant get a job because his skills are so specialized to carmax reconditioning that there just is no market for them in the outside world. Thanks carmax for laying off the working man who actually adds something to the value of your cars and keeping all of the top heavy corporate staff who are salaried. just last year the ceo got a 850k a year raise. yippe thats a raise not his total income.

Since: Sep 09

Montclair, CA

#15 Sep 13, 2009
Techs are worth more to any dealership than any other employee. Period. Without them, there would be no return business. Period.
Mike wrote:
Techs make 50-110k a year because of schooling and we must buy tools. How much a year do you spend in tools Buyer?

Since: Sep 09

Montclair, CA

#16 Sep 13, 2009
CarMax needs to send Ron Costa and his crew back across the border. Ever since they came to California, the California market has gone down the tube in morale. Derrick Handy, had it running perfect. He understood how to manage a market and his "troops." He and his crew built Carmax California when the rest of the company was afraid to come in. I remember when he came in and "took over" with a hostile crew. I knew right then and there that the end would soon come. I hope Carmax decides to rotate their Regional Management more frequently. In the long run it would save them millions. Good Luck!
madtech wrote:
What should have happend is the buyers get laid off cuz they dont know what the hell kind of cars they are buying and should have someone who KNOWS at least something about cars be a buyer you dam buyers dont even know what the hell your looking at when you get these cars from auctions or buying them from people off the street, ive kicked so many cars because of your stupid asses for missing obvious frame and core damage and you dont think thats not costing the company money???
michael

United States

#17 Sep 13, 2009
Carmax is just another big company that dosent want to pay their help. I cant wait to see them go out of business along with Autonation (power group)
previous tech

O Fallon, MO

#18 Sep 24, 2009
Hey, the year contract with dent wizard is almost here. Stay by the phones because carmax will call some people back. Remember Frank Scaffiti is no longer there to train new recon techs, who else is going to do it. Or maybe it doesn't matter because the public doesn't need a good looking car as long as it runs good RIGHT. Not.Lets face it they have to call some of the original recon techs back if they want to produce Qouality looking cars. Also thay need to bring Austin Liggons back, Tom Folliard doesn't know crap!!!
previous tech

O Fallon, MO

#19 Sep 24, 2009
CA Buyer wrote:
You need to understand if you were laid off, it was because you were being paid MUCH MUCH higher than than market for what you were doing and we simple could not afford to any longer. Plane and simple. As any business class will tell you, its much wiser to lay off that force and re higher at a market rate than to do pay cuts (Because of moral and work ethic problems that will occur post pay cuts)
As for your insight to how unwise it was for us to purchase SUVs. Be glad your not running the company.... or else you would have been laid off long ago. Leave the financial decisions to us. Our ability to react so quickly to turn rates, market conditions and inventory positions is the only thing that has kept this company in the green thus far and in these horrible economic times is a VERY LARGE competitive advantage.
IT SOUNDS LIKE YOU WERE ONE OF THOSE PEOPLE WHO WERE JEALOUS OF THE MONEY WE MADE. MAYBE YOU SHOULD TRY TO REPAIR A 5 INCH TEAR IN A LEATHER SEAT THAT SAVES CARMAX A COUPLE OF HUNDRED DOLLARS FOR TEN HOURS A DAY,OR MAYBE YOU WOULD LIKE TO REMOVE OVER 300 DENTS FROM A HAIL-DAMAGED SUV THAT THE BUYERS DID NOT SEE. TRY IT AND THEN TELL ME WHO GETS PAID TOO MUCH. I KNOW I COULD BUY A CAR FROM AN AUCTION OR CHEAT A CUSTOMER BECAUSE THEY FEEL THEY DONT HAVE ANY OTHER OPTION BUT TO SELL CARMAX THAIR CAR. WHAT A JOKE. EVEN IF YOU GUYS MADE MINIMUM WAGE IT WOULD BE TOO MUCH.
Former Recon Tech

United States

#20 Jan 9, 2010
The problem i have with CrapMax is we were not allowed to go out into the local business' and get side work and get your name out there. NOW after being there for 11+ years im fn screwed and starting over from scratch because TOM FOLLIARD is strokin his buddies from dent wizard and high tech locksmith whom he went to college with..IT WAS A INSIDE JOB. My good friend is still a manager there and has told me there spending double what they spent there with us. Frank Scaffidi is not there anymore cause he spoke up and saw what was going on. AS for you buyer saying we made to much money..GET A SKILL U PUTZ.. U CAN HAVE A DEGREE IN THEATRE ARTS AND BECOME A BUYER. CANT WAIT TO SEE THE DAY THIS COMPANY FALLS ON ITS FACE.....
previous tech

O Fallon, MO

#22 Jan 25, 2010
HEY GOOD NEWS CARMAX IS HIRING 600 PEOPLE. 590 SALES AND 10 DETAILERS. ANYONE WANT A JOB.IF YOU ARE INTERESTED IN BEING A DETAILER AND MAKING NO MONEY CALL CARMAX. WHAT A JOKE . THIS F****ING COMPANY HAS THE BALLS TO HIRE 600 PEOPLE ONLY 17 MONTHS AFTER THEY LAYED 600 OF US OFF. THEY STILL CONTINUE TO PAY HIGHER PRICES TO REPAIR THEIR CARS THROUGH DENT WIZARD. HOW STUPID IS THAT.

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