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Autobytel Hits the Brakes

Struggling online auto sales and info operation Autobytel Inc. hit the brakes again, this time laying off 40 people or about 15 percent of its employees. The move follows last month's report of a wider loss for the first quarter.

The Irvine, Calif.-based company said the restructuring would result in a charge of about $500,000, and "is a continuation of the efforts begun last year to reduce costs and improve operating efficiency subsequent to (the) acquisition of Autoweb."

Autobytel acquired its one-time rival, Santa Clara, Calif.-based auto sales site Autoweb.com Inc., in April 2001 in a tax-free merger deal valued at about $15 million in stock

Last month Autobytel posted a first-quarter net loss of $18.5 million, or 59 cents a share, after a $19.2 million charge for its European operations. It posted a net loss of $4.1 million, or 20 cents a share, a year ago. Revenue for the first quarter rose to $20.7 million from $16.7 million.

The latest move will save the company about $4 million on an annualized basis, Autobytel said.

"This restructuring is a result of simplification, streamlining, and considerable focus on business operations," said Jeffrey Schwartz, president and CEO of Autobytel. "We reduced operating costs significantly following the acquisition of Autoweb and have continued to focus on driving even greater efficiencies throughout the business. These efforts represent a continuation of that process. We are encouraged by the progress we are making and remain quite confident in our business plan."

Earlier this month Autobytel signed a marketing/fulfillment deal with automotive classified ad marketplace AutoTrader.com.

Autobytel also owns and operates Carsmart.com and Autosite.com, as well as AIC (Automotive Information Center), a provider of automotive marketing data and technology.