Hawaii’s only Volvo dealership, which has been embroiled in a yearlong court battle with its New Jersey-based distributor, has abruptly shut down.
Envy Hawaii LLC, which does business as Volvo Cars of Honolulu, said today it was forced to close after receiving a franchise termination letter late last week from Volvo Car USA for breach of contract involving customer trade payoffs.
The dealership at 704 Ala Moana Blvd. closed Wednesday after the last two mechanics walked off the job a day earlier.
John Martinho, vice president and general manager of Volvo Cars Honolulu, said the company ran out of money and had lost more than $2 million this year and had been trying to sell the dealership since June.
He said the nine remaining employees of the company will receive their final commission and paychecks through Friday and have had their health premiums paid through this month.
Martinho said the termination letter accused the Honolulu dealership of breaching its franchise agreement in a way that was detrimental to the Volvo brand and customers. He said customers complained to the distributor that the dealership was late in paying off the bank loans of cars that the dealership received as trade-ins.
Mike Fedotov, the owner of Envy, said he was devastated by the closure.
“I am heart-broken for all my employees and customers, this is not news I wanted to give them before Christmas,” Fedotov said. “I love the team I have here and all the customers that supported us from the beginning.”
Envy Hawaii began sales and service of new Volvos in December 2012 after purchasing the dealership from Jackson Volvo.
Volvo Car spokesman Russell Datz said the distributor is quickly working to find a new location to serve its customers in Hawaii. Customers can contact Volvo Car Customer Care for more information by sending an email to firstname.lastname@example.org or by calling 1-800-458-1552 between 6 a.m. and 3 p.m. Hawaii time.