Volvo Cars of North America Inc. has pulled out of a 10-franchise auto mall recently purchased by CarMax Group.
CarMax last Friday, Dec. 11, reopened the Mauro Auto Mall in Kenosha, Wis., as the CarMax Auto Mall. CarMax retained the mall's nine other new-vehicle franchises: BMW, Cadillac, Chevrolet, Ford, Jeep, Mitsubishi, Nissan, Subaru and Toyota.
Brad Bowers, Volvo vice president of franchise development, said a multifranchise mall does not fit in with Volvo's new market representation plan, announced earlier this month.
'We're looking for an exclusive customer experience in our major markets,' Bowers said.
The CarMax Auto Mall is located between Chicago and Milwaukee.
Bowers said Volvo has not ruled out working with CarMax in other markets where it makes sense. 'We have a very good relationship with CarMax,' he said.
Although CarMax's primary focus is its 25 used-car superstores, the Richmond, Va.-based retailer is moving increasingly into new-vehicle sales. Since 1996, CarMax has operated Chrysler-Plymouth-Jeep new-vehicle franchises out of its two Atlanta-area used-car superstores. In November, CarMax added a Mitsubishi franchise at its Laurel, Md., superstore and completed the acquisition of a stand-alone Toyota dealership, also in Laurel.
The company expects to open a second Mitsubishi franchise early next year and has agreements to buy two Nissan dealerships in California and South Carolina.
Val Brown, spokesman for CarMax, said Volvo has not rejected the CarMax concept. 'They like our sales process; they like our approach and are very enthusiastic about it,' Brown said. 'But they don't want to be part of an integrated environment.'
CarMax agreed in July to buy the mall from dealer Ralph Mauro. Since then, CarMax negotiated deals with automakers to keep the mall's other brands.
The company has named Chris Tilley as the mall's manager. Tilley formerly ran one of CarMax's used-car superstores in the Chicago area.
Brown said the auto mall will use the same processes CarMax has used at its used-car superstores. CarMax, a subsidiary of Circuit City Stores Inc., has increased the mall's staff to 150 employees from 125.
Said Brown: 'We want to make sure we have enough staffing to provide the same level of service we provide at other superstores.'