AutoNation's profits drop even as revenue grows
MIAMI - OCTOBER 26: Ford mustangs sit on a sales lot on October 26, 2010 in Miami, Florida. The Ford Motor Co. reported third-quarter earnings of $1.7 billion today, its sixth consecutive quarterly profit.
AutoNation Inc., the nation's largest automotive retailer, Thursday said its net income dropped 12.5 percent in the third quarter, even as its revenue grew.
Fort Lauderdale-based AutoNation reported net income from continuing operations of $59 million, or $0.39 per share, compared to net income from continuing operations of $64 million, or $0.36 per share, for the same period in the prior year. Strong new and used vehicle sales pushed revenue up 13 percent to $3.3 billion, compared to $2.9 billion in the same period last year, the company said.
AutoNation chairman and CEO Mike Jackson said, in an interview with Marketplace, he still expects 2010 new vehicle sales to total 11.5 million units for the auto industry.
Industry-wide auto sales projections for next year hinge on an economic recovery, Jackson said. Results of the coming election could impact consumer sentiment and ultimately improve the outlook for the auto industry, he added.
AutoNation's new vehicle sales increased 1 percent, beating the industry's third quarter new vehicle sales results. New vehicle sales industry-wide decreased 4 percent in the third quarter, according to CNW Research data.
AutoNation's used car and truck sales continued to yield positive results; sales increased 25 percent from a year ago, the retailer said.
"There's clearly a segment of the population that's interested in value," AutoNation President Mike Maroone said.