Advance Auto Parts to Close All Stores in California

Categories: California Business NewsCalifornia ManufacturingCalifornia News

Advance Auto Parts store preparing for closure amidst restructuring efforts.

News Summary

Advance Auto Parts is set to close all its California locations by March 2025 as part of a broader restructuring plan due to significant financial losses. The closure affects over 1,600 jobs and 137 stores, impacting local economies reliant on the retailer. The company aims to shut over 725 locations nationwide, and although this marks a challenging period, management promises transformative actions to ensure future growth. Employees affected by the closures will receive severance pay and outplacement services to aid their transition.

Advance Auto Parts to Bid Farewell to All California Locations

In an unexpected turn of events, Advance Auto Parts has announced its plans to close down all its remaining stores across California by mid-March 2025. This decision is all part of a larger effort to restructure and combat the company’s significant financial losses. It’s a tough blow as more than 1,600 jobs will be lost as a direct result of these closures, marking a challenging time for both employees and local communities who have relied on the retailer for their auto parts needs.

What’s Happening?

The auto parts retailer has laid out plans to shut the doors of 137 locations in California, having already started the process in early February 2025. A federal WARN notice made public the impending closures, giving employees at least 60 days’ notice to prepare for the changes ahead. As towns lose these stores, it creates a ripple effect that will surely impact local businesses and services, particularly car repair shops that may struggle without reliable access to parts.

Nationwide Impact

The California closures are part of a much larger undertaking by Advance Auto Parts, as they aim to close down over 725 locations across the country. Reports have revealed that this restructuring effort is a necessary response after the company reported a staggering $820 million operating loss in the fourth quarter of 2024. In light of these losses, the company is taking significant steps to right the ship, raising concerns among investors after sales projections triggered an 18% drop in stock value.

A New Direction

With the goal of positioning itself for a more secure future, Advance Auto Parts is not entirely folding its cards. In fact, CEO Shane O’Kelly has promised that transformative actions are underfoot to ensure long-term success. The company plans to consolidate its distribution network, operating just 12 large facilities by 2026, while also introducing 60 new market hub locations by mid-2027. This strategic pivot reflects a broader effort to respond to a decline in demand for auto repairs and enhance the company’s overall financial health.

Support for Affected Employees

While the announcement has left many workers and their families in uncertainty, affected employees can expect to receive severance pay and outplacement services to help ease the transition. The company is working to ensure that those who have devoted their time and energy to serving customers will receive the support they need as they search for new opportunities.

Looking Ahead

This restructuring venture isn’t just limited to California; states like Oregon, Washington, Nevada, and Arizona are also expected to see dwindling store numbers as Advance Auto Parts aims to exit certain markets altogether. The liquidation of inventory began in November 2024, with the goal to clear out stock from both corporate and independent stores in anticipation of the changes.

Despite the tough path ahead, Advance Auto Parts is committing to enhancing its retail offerings to return to consistent profitable growth. So while it’s a challenging time for the company and its employees, there may be a silver lining in its transformative plans for the future. As customers and communities brace for these changes, one can only hope that Advance Auto Parts can regroup and emerge stronger on the other side.