“This has been a very difficult decision. Each and every one of our associates are incredibly important to us. We will not rest until we can start pulling our team back together,” said Bill Nash, CarMax president and CEO. “I believe that these steps will help our company withstand the current environment and successfully emerge from these difficult times.”
Prior to the effective date of any furlough, CarMax is providing transition pay to each impacted associate. In addition, for furloughed associates enrolled in CarMax’s medical plan, CarMax will pay the current cost of the associate’s portion of the medical plan, plus the employer portion, until further notice.
CarMax is providing resources to help associates understand the changes and take advantage of the assistance available under the new CARES Act, which should provide significant financial support for most furloughed employees.
Effective immediately, CarMax president and CEO Bill Nash is forgoing 50% of his salary, and each member of the company’s senior leadership team is taking a reduction in pay until further notice. In addition, the CarMax Board of Directors has unanimously determined to forgo their cash retainer indefinitely.
Additional steps CarMax has taken to align costs with the state of the business include instituting a hiring freeze, reducing inventory levels, reducing marketing spend, ceasing store expansion activity and remodels, and halting the share repurchase program.
“We will continue to keep our stores open where permitted to support our customers’ essential needs for reliable vehicles and to provide as many jobs as possible for our associates. For the safety of our associates and customers, we have implemented social distancing practices and enhanced cleaning measures in all locations. We are focused on positioning the company for a strong recovery when this crisis is over,” said Nash.
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