PHILADELPHIA (Nov. 6, 2000) — Pep Boys-Manny, Moe & Jack has closed 38 stores and two distribution centers as part of a "comprehensive profit enhancement plan that will significantly reduce the company´s infrastructure and operating expenses."
The closures resulted in the elimination of 1,200 jobs, the company said in a press release. It said another 300 positions were cut through a reduction in the number of field and distribution center supervisors as well as the consolidation of its store support centers.
Pep Boys said it closed the 38 stores — which it said were unprofitable — the morning of Oct. 28. The largest number of shuttered stores by far was in Michigan, where 10 stores were closed. The company also closed five in Washington; five in New York; four in Indiana; three in Oregon; two each in Ohio, Massachusetts and Louisiana; and one each in California, Connecticut, Florida, Illinois and Texas.
Philadelphia-based Pep Boys currently operates 627 stores — encompassing 6,486 service bays — in 36 states and Puerto Rico. A Nov. 1 statement from the firm said it "is generally pleased with the performance of its remaining 627 stores" and does not contemplate closing any additional ones in the near future.
Pep Boys also said it has modified the management structure within its stores and "rationalized its hours of operation to better correspond with customer demand on a store-specific basis." It estimated that the annualized pre-tax benefit of the cutbacks and initiatives will equal approximately $70 million.
A spokeswoman said that, due to Federal Trade Commission regulations, the company is currently in a "dark-out period" which prevents officials from commenting further on the cutbacks until Nov. 10, when Pep Boys issues its third-quarter financial results for the 13 weeks ended Oct. 28.
However, the company did say those results will include an estimated $60 million pre-tax charge to earnings to reflect the required write-down of assets relating to the store closures, severance and other related costs, as well as costs associated with the recently completed refinancing of its credit facilities.