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Kia dealer to lay off 40 employees

New owner to keep dealership open during acquisition

Posted: April 11, 2014 5:18 p.m.
Updated: April 11, 2014 5:18 p.m.

The Kia of Valencia dealership on Friday.

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Forty employees of the Valencia Kia auto dealership are scheduled to lose their jobs in Santa Clarita on May 5, according to the California Employment Development Department.

In an ownership change, the Keyes Automotive Group will be taking over the Valencia Kia dealership.

“We are acquiring it between now and the end of the month,” the vice president of Keyes Automotive Group, Howard Tenenbaum, said this week.

The new owners, however, are not retaining the existing employees, according to Tenenbaum.

The Kia dealership first opened in early May 2011 under the umbrella of the automotive group California Superstores, which was then newly formed.

California Superstores also acquired the Chrysler, Dodge, Jeep dealership on Creekside Road, formerly a Power Automotive Group franchise.

Several local sources say California Superstores has since dissolved, but none would comment on the outcome for the Chrysler dealership. Keyes is not acquiring it, according to Tenenbaum.

California Superstores formed with the help of New York hedge fund York Capital Management. It also leveraged Chrysler’s offer to buy real estate in California, giving new dealerships lower rent at startup, according to a report in Automotive News at the time.

Chrysler wanted to kick start opening more franchises. The manufacturer reported at the time that its California network was seriously damaged when it terminated 32 dealerships in the state during its 2009 bankruptcy.

California Superstores CEO Carlos Hidalgo reportedly sold his Sacramento Dodge dealership to help launch the venture.
Employees at Kia were notified of the layoffs per requirements of the Worker Adjustment and Retraining Notification Act. The law requires at least 60 days’ notice to employees before a plant closing or mass layoff.

The Kia dealership is expected to remain operating throughout the change in ownership.




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