Saleen, Already on Shaky Financial Ground, Sued for Failing to Deliver

by Steph Willems

July 18th, 2016 10:00 AM

saleen already on shaky financial ground sued for failing to deliver

Two U.S. Ford dealerships are beyond frustrated with Saleen Automotive after the performance sportscar manufacturer failed to deliver its signature modified Mustangs on time.

According to Automotive News, Red McCombs Ford of San Antonio filed a lawsuit alleging breach of contract and fraud after the three Saleen Mustangs it ordered arrived six months late missing $22,000 in modifications. Friendship Ford of Bristol, Tennessee hasn’t received a Saleen Mustang it ordered over a year ago.

The situation calls into question Saleen’s financial situation and its ability to deliver product on time. Saleen has lost about $30 million since incorporating in 2011, and is low on cash. Regulatory filings show the California-based company has limited assets and steep liabilities. It also owed over $400,000 in past-due rent as of the end of March.

The San Antonio dealership tried, and failed, to recoup the money it lost on the Mustang order, forcing it to go the legal route. As for the Tennessee dealer, it just wants to find its missing Mustang. The vehicle was supposed to be shipped by the end of last year, and although Saleen says it was shipped in early June, there’s been no sign of it in Bristol.

“I don’t know where the car is. I don’t have a clue,” said Friendship Ford general manager Denny Fruth told Automotive News. “Every month this year, it’s been another story. I actually thought about jumping on an airplane to L.A. and walking in the shop to see if it’s in there.”

When questioned by the publication, company founder and CEO Steve Saleen said demand for his modified version of the current generation Mustang is “unbelievable,” and he hadn’t heard of the lawsuit. When told of it, Saleen called the suit “a little frivolous,” adding that his company is still a startup, and the current Mustang is still relatively new.

The continued demand for Saleen products proves that the company is doing something right, Saleen said, though he admitted the company needs to find more capital.

[Image: Saleen]

#Ford #Lawsuit #Modifications #Performance #Saleen #SaleenMustang

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12 of 39 comments

Corey Lewis on Jul 18, 2016

Those dealers should just contract with a responsible company to modify their cars, like Vector.

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- 28-Cars-Later on Jul 18, 2016
  
  Vector the shady knife company?
  
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- Corey Lewis on Jul 18, 2016
  
  @28-Cars-Later Vector Motors! They've got a great website where everything works. http://www.vectormotors.com/
  
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- 28-Cars-Later on Jul 18, 2016
  
  @Corey Lewis The entire website is an image and footer. I wonder if their offices feature cardboard cutouts of people as opposed to employees?
  
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- Corey Lewis on Jul 18, 2016
  
  @28-Cars-Later Hahaha. Picturing that. A little office in a strip mall, with cutouts of "business man #4." Someone comes to move them around twice a week.
  
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- 28-Cars-Later on Jul 18, 2016
  
  @28-Cars-Later I bet its the same cutouts of the man, woman, and salesman we see on here every so often. I mean they do look pretty fake, don't they?
  
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- Corey Lewis on Jul 18, 2016
  
  @28-Cars-Later "Hi, I work in business! You can tell because I have on a jacket, and there's a pen in my hand!" "Hello, I'm a customer. I have a purse and am checking my watch with impatience!"
  
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- Eyeflyistheeye on Jul 19, 2016
  
  @Corey Lewis Hey, you don't see Mary Barra or Sergio putting up their cell phone numbers, that's real confidence! Not to mention his "office" is a 15 minute drive from my work.
  
  Like
- Corey Lewis on Jul 19, 2016
  
  @Eyeflyistheeye Now you have to drive by and take pics.
  
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- Raph on Jul 19, 2016
  
  @Corey Lewis Hah! Weigert certainly is persistent when it comes to trying to rake in free money.
  
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Seanx37 on Jul 18, 2016

I didn't even know Saleen was still in business. Perhaps they and Hennessy can go out of business together. Con artists...

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- Raph on Jul 19, 2016
  
  Even as bad as things look Saleen still has a way to fall before they can go shoulder to shoulder with Hennessey. That operation has been shady for as long as I can remember (the mid to late 90's as I recall). Saleen was pretty tight until he sold his company to a bunch of rich guys looking to spend some money and zero knowledge of the business and I suppose thought they were savy enough to turn a profit and make cool cars but found out its a low margin business that requires some very specific expertise. Especially when your trying to turn out a top-notch product. Those big money guys then proceeded to run Saleen into the ground and the name along with it. I suspect Steve Saleen just doesn't want to face the writing on the wall. Saleen's glory years are well behind it and should just retire the company while it has something of a reputation left.
  
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