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Cazoo’s outgoing boss, Paul Whitehead, says he is “proud” of the company’s achievements despite its decision to pull out of used car sales due to crushing losses.
Cazoo announced that Whitehead would step down as CEO when he informed investors of his goal of creating an online advertising marketplace to compete with Auto Trader and Motors.
The news came after months of developing hypotheses about the company’s future, amid massive losses, after years of overspending and exuberant.
Writing on LinkedIn last week, Whitehead admitted mistakes were made along the way, but insisted he was proud of his time at the online retailer.
He also revealed that he would be an advisor to “support the transition to its new market business model”, following his departure as CEO at the end of March.
In a lengthy article, Whitehead encouraged those who remain with the company not to lose their “data-driven mindset” and “entrepreneurial spirit. “
He said: “Since Cazoo started from a piece of paper just over five years ago, it has been an adventure and an absolute privilege to lead an incredibly talented team of 5,000 people at its peak, across the UK and Europe.
“Following the company’s recent strategic review, I believe my tenure as CEO deserves to end at the end of March.
“It wasn’t an easy decision. Cazoo means a lot to me, but I have agreed to continue advising the company as it transitions to its new business model in the market. “
He added: “Looking back, we completed a lot of things, we made mistakes along the way, but we learned a lot at the same time. I’m incredibly proud of what we accomplished together.
“Thank you to everyone who has shown so much passion and power for Cazoo’s visitor experience. For those who remain in the transition, never lose your data-driven mindset, but most importantly, your entrepreneurial spirit.
In an explosive announcement to investors last month, Cazoo said it would “launch” its shares and sell them in retail and wholesale channels.
It will also make job cuts (following the numerous layoffs announced last year) as it becomes a market.
The announcement follows the reshuffling of the board of directors and the departure of founder and former CEO Alex Chesterman in December, when the financially troubled company restructured its debt in a deal in which its $630 million loans became $200 million.
Despite the recent headaches, Whitehead says Cazoo has “broken the mold” in the used car market and “created a new category for buying and promoting used cars online. “
He said: “Five years ago, it was unimaginable to buy a used car entirely online in the UK.
“We want to break the mold and create a new category for buying and promoting used cars online and as a result we sold 160,000 cars.
“Cazoo’s logo and platform attract one million consumers every month, are firmly established, and lead the category.
“We now intend to use all this to gain advantages for the automotive industry. “
Throughout its turbulent history, Cazoo has dealt several blows to classic retailers, who now seem to be hoping to take money out of their wallet to promote on their site.
Chesterman infuriated used car dealers when he entered the auto trade scene, calling them “salesmen with pointy elbows. “He also claimed that the classic approach to promoting cars “failed across the board. “
The founder of Zoopla and Love Film criticized dealerships for offering only “7-minute checkpoint tours” and claimed that buying a car from a dealership was “inconvenient. “
Given this strained relationship, it’s perhaps no surprise that Whitehead’s message hasn’t been massively positively received by the auto industry.
In response to LinkedIn, retail auto investor Bruce Beaton said, “It’s been a disaster. Ego patronage, low margins, burning other people’s money, and disrespect for industry peers. There’s not much on display.
Gregor Menzies, Managing Director of Bargain Cars Angus Ltd, added: “If there’s one thing Cazoo has shown, it’s what we’ve been saying for a long time: that a full online style doesn’t work, it’s one of the reasons why it went bankrupt.
“Most still like to touch, smell, smell and drive before they buy.
“Buying a vehicle is the most important product other people make, and therefore, in my experience, they rightly expect a personal touch rather than an anonymous representation, all driven by accounting and greed.
“In fact, this is a talentless technique compared to what was once a competent and enjoyable industry. “
Another dealership, with a quarter-century of experience in the auto industry, accused Whitehead of having an “alternate reality” when it came to Cazoo.
Frank McGrath, owner of FMG Automotive in Cambridgeshire, said: “To the other people who wish you all the best and tell you what a wonderful job Cazoo has done. Do you realize the absolute display and how much money was lost along the way?
“You failed to make money selling cars remotely at a time when the country was in lockdown and situations couldn’t have been better for you.
The rest of the industry goes on and now Cazoo is looking for something else because he can’t collect any more cash from the city (after all, they learned that this money would be lost like the rest).
“There’s nothing against you personally, but you seem to have a shared truth of what happened. “
You can read more about Cazoo’s history here. You can also watch our special documentary about the company’s downfall below:
Jack joined the car dealership team in 2021 as a copywriter. In the past he worked as a journalist for a national newspaper for the BNPS news agency. He has provided automotive news and reports for several national publications, including The Sun, The Times. and The Daily Mirror.
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