AutoNation Inc.’s net income tumbled sharply in the first quarter as revenue slipped and the country’s second-largest dealership group sold fewer new and used vehicles.
AutoNation reported Thursday that first-quarter net income dropped 20 percent compared with the year-earlier quarter, to $288.7 million. Revenue dipped 5 percent to $6.4 billion.
The retailer’s new-vehicle retail sales declined 2.4 percent for the period, while used-vehicle retail sales dropped by 15 percent.
AutoNation CEO Mike Manley said in a statement that the retailer managed its used-vehicle business “with a deliberate focus on driving gross profit.” The company’s gross profit per used vehicle retailed rose 35 percent to $2,117. Gross profit per new vehicle retailed dropped 15 percent to $5,210, down from the year-earlier lofty levels driven by the industry’s new-vehicle shortage.
Manley also touted an 11 percent jump in gross profit for AutoNation’s parts-and-service business.
“Our first quarter results demonstrate the resiliency of our operations and the benefits of a diversified business model,” Manley said in the statement.
AutoNation repurchased 2.4 million shares of stock during the first quarter, continuing a practice it has regularly pursued.
AutoNation’s shares were trading at $131.82, down 3.3 percent, on Thursday morning just after the stock market’s opening.
Q1 revenue: $6.4 billion
Q1 net income: $288.7 million
Vehicle sales: 55,065 new vehicles retailed, down 2.4 percent; 67,539 used vehicles retailed, down 15 percent.
Ranking: AutoNation, of Fort Lauderdale, Fla., ranked No. 2 on Automotive News‘ most recent list of the top 150 dealership groups based in the U.S., with retail sales of 229,971 new vehicles in 2022.
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