US subprime lender America’s Car-Mart slashes 40% of locations amid liquidity crisis
America’s Car-Mart has closed 60 of its 154 dealerships, citing severe debt challenges and a need for additional financing to avoid potential bankruptcy protection.
America’s Car-Mart, a prominent US used-car dealer specialising in subprime financing, has closed 60 of its 154 dealership locations, representing a 40% reduction in its operational footprint. The closures, implemented between April 2025 and April 2026, were driven by severe liquidity and debt challenges rather than customer payment performance issues. For the fiscal year ended April 2026, the company reported a net loss of $139.11 million, a sharp reversal from the $17.93 million net income recorded in fiscal 2025.
In its Form 10-K filed on July 14, 2026, management included a "going concern" disclosure, warning that failure to secure additional financing could result in bankruptcy protection. The retailer reported total revenue of $1.281 billion for the period, a 7.9% decline from fiscal 2025, while gross profit per unit improved marginally to $7,442. Net loss per share stood at $16.79, compared to earnings per share of $2.38 in the prior year.
CEO Doug Campbell stated that the consolidation was intended to preserve liquidity amid limited origination capital and the absence of a revolving warehouse facility. The company intentionally reduced originations and inventory to protect its cash position, avoiding loans it lacked the capacity to carry. Campbell noted that phase one of the restructuring involved closing five underperforming stores and eliminating approximately 10% of employees, while phase two consolidated 13 additional locations.
The "going concern" principle indicates substantial doubt about the company's ability to continue operating over the next 12 months. Management clarified that this disclosure reflects unresolved liquidity constraints rather than changes in customer repayment behaviour. Existing borrowers will continue making payments under the same terms, with loan servicing transferred to other locations as necessary.
The financial distress of America’s Car-Mart highlights broader pressures within the subprime auto sector, where high interest rates and affordability issues are impacting both consumers and lenders. Senator Elizabeth Warren has previously investigated the "buy here, pay here" industry, citing concerns over predatory practices and high repossession rates for vulnerable borrowers. As financing costs rise, dealerships serving higher-risk borrowers face increasing scrutiny and operational challenges.
