Due to low demand and operational losses, Advance Auto Parts, a car parts supplier, will close all 136 stores in California by the end of March.
The company, headquartered in Virginia, issued a notice through the WARN system in California last November, indicating the closure of 136 retail stores and two offices. The closure process began in mid-February and is set to continue until March 29.
Advance Auto Parts has been implementing a “hybrid box” strategy to cater to both DIY customers and professional technicians. The company announced its transformation initiative last year, which was initiated in 2024. Shane O’Kelly, the President and CEO of the company, mentioned in the fourth-quarter financial report released last month, “In 2024, we embarked on transformation measures to reposition ourselves for long-term success and value creation. Through divesting non-core assets, closing non-strategic stores, and optimizing organizational structure, we are focusing on strengthening the hybrid box strategy.”
The company’s board approved a restructuring and asset optimization plan last year, aiming to improve profitability, foster growth, and streamline operations.
According to their statement, Advance Auto Parts plans to close around 500 stores, approximately 200 independent stores, and four distribution centers by mid-2025. As of December, the company operates 4,788 stores in the United States, Canada, and the Caribbean.
The strategic and operational plans of Advance Auto Parts are expected to result in $150 million in savings, with $50 million to be reinvested. Apart from reducing the workforce, the company has streamlined its supply chain to deliver parts closer to customers.
Advance Auto Parts is among the latest companies to announce their exit from the California market. Foster Farms, a turkey and chicken products supplier, recently revealed its decision to shut down a turkey processing plant in central California on May 9, laying off over 500 employees. Discount retailer Big Lots also announced last year its plan to close all 54 stores in California due to economic challenges and declining consumer spending.