Administrator Appointed As Used Auto Site Cazoo Fails NYSE Compliance

Cazoo aimed to revolutionize the pre-owned automobile market in the United Kingdom and Europe.

Cazoo, an online car dealership that was previously valued at a high $8 billion, has gone into administration. A company called Teneo has been assigned to find a buyer for the remaining assets, particularly its online marketplace.

After being listed on the New York Stock Exchange in 2021, the business, which had set out to transform the process of purchasing used cars in the United Kingdom and Europe, has gone bankrupt a little over two years later.

Cazoo, being daring in their marketing strategy, invested a considerable amount in sponsorships. They funded Premier League soccer teams Aston Villa and Everton, along with other sports such as horse racing, darts, snooker, and cricket. Their slogan was "Cazoo yeah you can".

Cazoo's objective is to revolutionize the process of purchasing and selling cars in the United Kingdom. They aim to offer clients a broader range of cars, transparency, ease, and reassurance. Their ultimate goal is to create an experience similar to buying any other product online, where customers can effortlessly buy, sell, and fund their car all online.

Even though it claimed to have sold more than 160,000 cars since its inception in 2018, the recent economic downturn caused a decrease in the demand for used cars. Consequently, the company's finances suffered, and in 2022, they conducted a review of their operations, concluding that they should withdraw from their European market. This led to over 700 job losses and losses amounting to more than $890 million in the same year.

Chesterman Launches Cazoo

The creation of Cazoo was initiated by Alex Chesterman, who characterizes himself as a repeated entrepreneur and who earlier introduced the well-liked real estate site Zoopla, along with the precursor to Netflix called LoveFilm. However, Chesterman relinquished his position as CEO of the company in the beginning of 2023 and became the chair, only to later resign from his duties in December of the previous year.

Earlier this year in March, Cazoo declared a new wave of reorganization. This involved selling an automobile repair center situated in Luton, which is located north of London. Additionally, the company would be getting rid of the customer collection centers in Bristol and Birmingham. Cazoo confirmed that it would put all its efforts into enhancing its online buy-and-sell platform. As a consequence of this decision, the company is expected to let go of an additional 720 workers.

At the moment, Cazoo expressed that this move would make good use of their main strengths - their well-known and trustworthy brand, combined with their advanced technology platform. This top grade platform is what grants remarkable experiences to customers, and in turn, will drive even more clients and U.K. dealerships to conduct transactions digitally.

NYSE Filing By U.S. Company

Although the management was able to successfully reduce loans and simplify operations, they determined that the company still lacked sufficient funds to maintain its business in the future. Consequently, the board stated in a filing with the United States that it was advisable to appoint administrators to initiate the company's liquidation since it would serve the company's and its stakeholders' best interests.

Cazoo is shutting down its customer service centers and actively looking for a purchaser for its internet-based market platform. This information was photographed by Bloomberg's Chris Ratcliffe.

After our meet-up, we kept moving forward with talks with various groups who are showing interest in the market business and the rest of the customer collections centers, stated Matt Mawhinney, the administrator from Teneo.

We are pleasantly surprised by the success of the marketplace model, as a lot of dealers are joining. Moreover, with the new administration appointment, we have a chance to sell the business in the next few weeks.

At present, Cazoo boasts a staff of 200 individuals, with 124 employed in the marketplace division situated in London. Another 25 staff members work at the customer collection centers situated in Manchester and Northampton, belonging to the group.

Cazoo has announced that it will be conducting a special meeting for its investors on the 6th of June in order to request permission to begin the winding-up process.