Midas Sales Slide as Drivers Defer Car Repairs

Midas Inc. announced late Monday that consumers are putting off major auto repairs causing three quarters of sliding sales for franchise owners.

Chairman and Chief Executive Alan D. Feldman said that "the retail trends of the first and second quarters have continued into the third quarter, negatively affecting our franchise revenues as well as operating results at our 93 company-owned shops."

Sales of maintenance and tires continue to grow, the company said, but sales of brakes, which account for nearly 40 percent of revenue, "continue to decline as consumers defer major purchases," Feldman said. [Chicago Tribune]

Remember those Australian Midas franchise owners blaming their franchisor for a flawed business model in which they couldn't make money nowadays?

In North America, the market has turned ugly. Consumers are not only deferring buying new cars but now they are also refraining from repairing their old cars. With the price of gas, some stats say consumers are driving less too, which could explain why they can repair their cars less.