Autoquake in administration
22 March 2011
Online used car supermarket Autoquake was taken into administration on 17 March.
The company has appointed Matthew Bond and Jason Godefroy of corporate restructuring specialist MCR to oversee the administration process and search for a buyer.
Autoquake was established in 2005 and grew to become one of the UK's leading online used car retailers, claiming to sell about 1000 cars a month.
It operated handover centres in London and Leeds and would deliver vehicles to customers for a typical cost of £150.
However, Autoquake was criticised for having a lack of motor trade experience and for eliminating the wholesale remarketing process from its business model.
By sourcing stock directly from fleets and leasing companies, Autoquake claimed to have cut out the "expensive middlemen".
But Manheim Remarketing's boss Mike Pilkington said, despite Autoquake's prominence as a "quasi-retail" sales channel, its business model was "a challenging one".
Pilkington said Autoquake's decision to take a link out of the value chain by removing wholesale remarketing was "somewhat naïve".
"Success in today's competitive market is driven through a proposition which offers speed to market through a choice of physical and online sales channels coupled to an infrastructure providing logistics, inspections, reconditioning, vehicle imaging and preparation," he said.
Manheim said it was currently remitting funds back to Autoquake for a small number of its part-exchange cars sold at auction.
BCA also said Autoquake's business model had, in practice, failed to live up to its expectations of providing an alternative to the "tried and tested" wholesale and retail channels.
Communications director Tony Gannon said: "The Autoquake model set out to offer something new by providing an online retail proposition to the consumer for used vehicles sourced direct from the fleet and leasing sector but unfortunately the reality has fallen short of the vision."
In March last year Autoquake was reported to have received £6m in venture capital and venture debt financing.
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