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.
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