Heartland Files for Bankruptcy

Interesting (and troubling?) news item in today’s Washington Post. Looks like Heartland Automotive, the nation’s largest Jiffy Lube franchisee with 400+ stores ranging from Missouri/Nebraska all the way to Southern California, is declaring bankruptcy. You might remember that Heartland Jiffy Lubes were the ones slammed by KNBC in Los Angeles in 2006 for not performing services that customers paid for.

This follows on the heels of news that the Jiffy Lubes in Rochester, New York recently shut their doors. Preliminary figures from our 2008 TOPS in the Industry ranking are showing that the nation’s largest fast lube chain will actually see a net decrease in stores this year. Interesting times in the fast lube business.

About National Oil & Lube News

National Oil & Lube News is the fast oil change industry's oldest and largest trade publication. Started in 1986 by Steve Hurt (a former fast lube owner) and David Arrington, NOLN has grown and evolved right alongside the fast lube industry. Here at NOLN, our aim is to help fast lube operators with every facet of their business, from operations to technical issues. Our monthly magazine and this regularly updated website contain everything from technical tips, recall announcements and service guides to articles on handling customer complaints, building your brand and making your business the best it can be. With tips and advice from experts both inside and outside the industry, you're sure to learn something that can help your fast lube business grow and prosper.
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5 Responses to Heartland Files for Bankruptcy

  1. Anonymous says:

    I work for heartland automotive and I think this could be a good thing for us. I really hope when its all over and done we will be a better store and a better company. I hope they fix everything in our stores because right now most of the stores are in bad shape. We all make do with what we have but they really need to get their act together because appearance has lot to do with the way it’s ran. If the stores were painted nice and the bay doors looked better we would have better luck getting the customers in. I know if I was a customer I wouldn’t come in to my store because of the bay doors. Some doors have glass and some don’t. The place really looks like it’s been on it’s last leg for the last ten years. It really looks bad when we charge high prices on extra services but the store still looks run down. We keep it clean but you can’t tell. I just hope when heartland gets caught up, they remember their stores and not about their pockets. Thank you!

  2. Anonymous says:

    Can anyone provide more details, e.g., will they try to reorganize? What is thier debt level?I know they filed in Ft. Worth, under Chapter 11.

  3. Anonymous says:

    Seems to be a trend. DDS Management who owns multiple Jiffy Lube franchises in NY and PA just filed for bankruptcy also.

  4. Anonymous says:

    Heartland filed in the same court as the former Dallas franchisee. The result of that case was the closing of a large number of stores, and rebranding of most of the remainder. Dallas ultimately went from about 50 franchised stores to 1. It also seems to this observer that a number of the larger operators may have sold their land and buildings to third parties at a sizeable profit, (which they have banked), and now have to find ways to pay high leases for the next 15 years. With rising oil prices, high lease levels, and declining car counts, will they survive? My prediction is that the bankruptcy attorneys will do a brisk business this year and next.

  5. Anonymous says:

    According to comments by the United States Trustee in the Heartland case, “Quad-C partners received millions in stockholder distributions from the Debtors in the three years preceding their Chapter 11 filings. Between 2006 and 2004, the Debtors increased their long term debt obligations from $35,150,000 to $217,547,846 (an increase of $182,397,846). Over $127 million of these proceeds were paid to stockholders during fiscal years 2005 and 2006. The remaining $55 million was used for corporate purposes. Given that as of March, 2007, Quad – C Partners had a 74% equity ownership in the Debtors, Quad C would have recieved the bulk of these proceeds.So the question occurs: Was Heartland selling it’s real estate to third parties, pocketing the profits of the sale, and saddling itself with high long term leases?

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