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CarMax starts media agency review

CarMax Inc. has commenced a media agency review, people privy with the matter told Advertising Age. The move came months after the company named Cheil's McKinney as its new creative agency and less than a year since Jim Lyski joined as chief marketing. It is of note that Lyski was the former CMO at Scotts Miracle-Gro, another media agency account also in review and under new marketing leadership.

CarMax chief executive Tom Folliard said in August 2014 that Lyski’s extensive marketing experience and strategic understanding of today's consumer could prove to be a tremendous asset to the company, which he said is in the midst of a national expansion plan.

The company is set to issue an RFP in the next few weeks and commence presentations in February. CarMax posted a 4-percent surge in net earnings to $454 million and 13 percent in total revenue to $10.7 billion in the first nine months of its fiscal year.

Read the entire article CarMax starts media agency review

Lifetime ban on LA Clippers owner could entice sponsors to return

The corporate sponsors of the Los Angeles Clippers basketball team – like Kia Motors America, Mercedes-Benz and CarMax -- may soon come back after the National Basketball Association banned owner Donald Sterling for life. Sterling was recorded as making racist remarks, for which he was also fined $2.5 million.

His remarks sparked nationwide outrage from people both inside and outside of the NBA. The remarks as well as remonstrations have led a number of companies and firms to cancel or suspend their sponsorships of the Clippers. NBA Commissioner Adam Silver said he will commence the process of compelling Sterling to sell the Clippers.

Kia Motors America, which is also the official automotive partner of the NBA, said that it appreciates and endorses Commissioner Silver’s “decisive action.” The carmaker has said that while its corporate sponsorship of the Clippers has been suspended, its relationship with franchise player Blake Griffin would continue.

Read the entire article Lifetime ban on LA Clippers owner could entice sponsors to return

Kia, Mercedes-Benz and CarMax drop LA Clippers backing after owner’s racist remarks

The alleged racist remarks by Donald Sterling, owner of the Los Angeles Clippers of the National Basketball Association, have led several corporate backers – like Kia Motors America, Mercedes-Benz dealers and CarMax -- to drop their sponsorship of the team. CarMax was the first sponsor to abandon the Clippers.

The used-car retail giant told ESPN that it finds Sterling’s alleged statements about black players and celebrities to be "completely unacceptable." CarMax has been sponsoring the LA Clippers for nine seasons. Following CarMax’s lead is Kia Motors America, which said it was suspending its sponsorship of the Clippers over the "offensive and reprehensible" comments allegedly made by its billionaire owner.

Kia also serves as the official automotive partner of the NBA and sponsors TNT's "Inside the NBA." Kia spokesman Scott McKee said in a statement that as fans of the game of basketball, the carmaker’s support of the players and the sport “is unwavering." Mercedes-Benz’s dealers in Southern California dealers are also abandoning the Clippers.

Read the entire article Kia, Mercedes-Benz and CarMax drop LA Clippers backing after owner’s racist remarks

CarMax now has 133 stores, plans up to 43 more until February 2017

CarMax Inc. opened two used-car stores in Rochester, N.Y., and Dothan, Ala., in March after opening 13 outlets in the fiscal year ended Feb. 28, according to chief executive Tom Folliard during a conference call. That means the retailer now has 133 stores, with plans open 28 to 43 more by the end of February 2017.

CarMax posted an 18-percent rise in sales in the previous fiscal year to 526,929. "We're in full swing now," Folliard said. He remarked that its store in Dothan is CarMax's third small-format store. Measuring on 4,400 square feet, the Dothan store occupies around 3.7 acres and stocks about 120 used cars and trucks.

In 2013, a CarMax spokeswoman told Automotive News that a small-format store is around 7,000 square feet, stocking around 150 used cars and trucks.

Read the entire article CarMax now has 133 stores, plans up to 43 more until February 2017

CarMax Inc. posted a 12-percent surge in net profit in the third quarter ending Nov. 30, 2013 to $106.5 million, thanks to increased used-car sales and higher income at its captive finance unit. The company also logged a 13-percent rise in revenues to $2.94 billion in the same period. The company’s captive finance unit, CarMax Auto Finance, also recorded higher net income in the third quarter ending Nov. 30, 2013, to $83.9 million, from $72.5 million in the same period in 2012.

“The earnings growth was driven by double digit increases in total used unit and CAF income,” CarMax chief executive Tom Folliard said in a statement. The company’s used-vehicle unit sales surged to 122,065 in the period this year from 105,815 in the same period in 2012, attributing the higher unit sales to “improved execution in our stores and an attractive consumer credit environment, as well as a modest increase in store traffic.”

CarMax logged a 4-percent rise in wholesale vehicle unit sales third quarter ending Nov. 30, 2013, to 82,743, compared with 79,747 in the same period in 2012. The company said that this reflects the growth in store base. “Other sales and revenues” dropped 5-percent year-over-year with its extended service plan revenues increasing very slightly to $48.8 million from $48.6 million.

Read the entire article CarMax logs 12% rise in Q3 net profit to $106.5 million

Sonic Automotive Inc. is planning to launch independent used-vehicle specialty stores in late 2014, taking on CarMax Inc., the largest used-vehicle retailer in the United States. The independent used-vehicle specialty stores will be separate from Sonic’s existing franchise dealerships. Jeff Dyke, executive vice president of operations at Sonic, remarked that the retailer is planning to break ground on the first specialty store in Denver, "less than 5 miles" from one of two CarMax stores in the market.

Dyke remarked during the Sonic’s third-quarter conference call that the retailer is planning around a hundred used-car stores, but the figure is only “the tip of the iceberg." He remarked that "it's time for a new player." CarMax is No. 1 on the Automotive News list of the top 100 dealership groups in the US -- based on used vehicle sales -- disposing 408,080 units in its fiscal year ended Feb. 29, 2012. Sonic is fourth on the list with used-vehicle sales of 105,615 in 2012.

On the other hand, CarMax is 107th on the Automotive News list of the top 125 dealership groups in the US – based on retail new-vehicle unit sales – selling 7,679 new units in its fiscal year ended Feb. 29, 2012. Sonic sold 132,136 vehicles in the period, good enough to be named third in the list. According to Dyke, Sonic has been considering the independent used-car store concept since 2005.

Read the entire article Sonic plans to open stand-alone used-car stores in 2014, take on CarMax

CarMax Inc. posted a 26-percent surge in net profits to $140.3 million and an 18-percent jump in revenues to $3.25 billion in the fiscal quarter ended Aug. 31, 2013. CarMax has also disclosed the locations of five planned used-car dealerships, bringing to 17 the total number of stores the retailer plans to open by Aug. 31, 2014.

According chief executive Tom Folliard, CarMax has not changed its plans to open 30 to 45 used-car dealerships over the 36 months that started March 1, 2013. He remarked that the 17 new stores over the next 12 months is just a refinement of the timing and the company has not changed its projections. CarMax sold 21 percent more used cars and trucks in the fiscal quarter ended Aug. 31, 2013 to 134,854 units, with sales at stores open for at least one year surged 16 percent.

According to Folliard, CarMax's sales mix has been consistent over the past few years, with vehicles five years and older accounting for around 25 percent while trucks and SUVs make up 25 percent. Sales of compact and mid-sized cars accounted for nearly 40 percent.

Read the entire article CarMax logged 26% rise in net profits in quarter ended Aug. 31

CarMax Inc. posted a significant increase in profit for the third quarter ended Nov. 30, 2012, logging $94.7 million in net income, or 41 cents per share, for the period. The largest used-car retailer in the United States logged $82.1 million in net earnings, or 36 cents per share, in the third fiscal quarter of 2011. CarMax attributed its strong third-quarter profit to a rise in supply, more attractive financing options and improved customer sentiment.

According to the retailer, used-car supplies have improved, following a shortage in the previous quarters, as customers disposed their old cars to acquire more recent used models and new ones.

In a conference call, CarMax chief executive Thomas Folliard said that consumer sentiment has improved, which may be resulting in more engaged customers in their stores. CarMax Chief Financial Officer Thomas Reedy remarked that customers have become more responsive to low interest rates, resulting to higher sales and fewer "payoffs," in which customers sell their vehicles to CarMax but do not purchase a replacement.

Read the entire article CarMax posted $94.7 million in net income for third fiscal quarter

CarMax Inc. reported a drop in profits during the fiscal first quarter, demonstrating a decrease in the demand for new vehicles. The net income of the largest retailer of used cars in the U.S. for the first-quarter ended May 31, decreased to $120.7 million, or 52 cents per share. In comparison, its net income one year ago was $125.5 million, or 54 cents per share.

Its revenue rose 3% to $2.77 billion. Its gross margin fell from 14.3% a year ago to 13.8% this year. In this same quarter, new-vehicle sales dropped by 13% to 2,107 units. CarMax operates new-vehicle franchises with Nissan, Toyota, Chrysler and General Motors. In the first quarter, its total used unit sales increased by 3%.

The retailer said that its current operations include 112 used car superstores spread out in 56 markets. CarMax said that the total customer traffic and conversion at comparable stores were about the same as the first quarter of the previous year. CEO Tom Folliard released a statement to say that even if the comparable store used unit sales were flat, CarMax had strong used and wholesale gross profit per unit and higher CarMax Auto Finance income due to its solid execution.

Read the entire article CarMax reported a drop in profits during the fiscal first quarter

CarMax Inc. aims to expand and to open up to 55 used-car stores through February 2016, a 50% climb in store count. Based in Richmond, Va., Carmax announced that its net earnings and revenues increased in the quarter that ended Nov. 31. The used-car retailer said that there was a slight dip in the unit sales of used cars and trucks in the quarter. The most affected stores are those that had been open for at least one year. According to CarMax CEO Tom Folliard, the company aims to open 10 CarMax stores in its fiscal year that starts March 1.

In particular, it hopes to open 10 to 15 new stores in each of the three coming fiscal years. CarMax currently runs 107 used-car stores in 50 markets. Folliard told analysts on a conference call made recently that if the situation doesn’t get worse, it will persist in managing its business the same manner that it has when it comes to efficiencies and margins. This would be its growth plan.

However, the company will “cut back” if the conditions become worse. He said that with an improvement, there would have to be a range to cover that. Folliard said that around half of the new stores will be produced in new markets while the other half will be made in markets that already have CarMax stores.

Read the entire article CarMax aims to expand and to open up to 55 used-car stores

The United States' largest used-car retailer - CarMax Inc. – has two 30-second ad spots for the Super Bowl in February 2011. One ad will run in the second quarter while the other will be seen in the third quarter.

Vice president in charge of creative marketing and advertising, Laura Donahue, was mum on what these spots will be; however, she did say furry creatures won't have quite the starring role they had in the past and she did guarantee the work would be funny, but in a "sophisticated" way. CarMax's previous regional ads for the game have starred animals like prairie dogs and monkeys.

The creative work is being done by CarMax's new agency, Amalgamated, of New York and the force behind the ads is Eric Silver, who became chief creative officer and majority owner of Amalgamated in September 2010. Donahue also talked about the ads with Advertising Age, a sister publication to Automotive News.

Read the entire article CarMax will make its first national splash in the Super Bowl in February