A 26% improvement in net income was posted by AutoNation Inc. in the first three months of 2011; however, it lowered its prediction for U.S. industry sales for the entire year due to supply disruptions related to the disaster in Japan. Meanwhile, the net profit of the nation's largest auto retailer climbed to $69.4 million from $55.2 million the previous year.
Revenue rose by 17% to $3.31 billion. AutoNation estimated industry light-vehicle sales in 2011 to reach 12.8 million but it changed this forecast to the "mid-12 million" range. In a statement, AutoNation CEO Mike Jackson said that there are “significant reductions” in the shipments from Japanese car manufacturers until the end of the year.
Shipment levels are only expected to normalize in early 2012. In early April, AutoNation said that over half of the new vehicles that it sold in 2010 were built by Japanese companies like Toyota Motor Corp. and Honda Motor Co.
AutoNation revealed that of the total deliveries last year, about two-thirds were built in North America. But Jackson remains optimistic and stated that the “underlying recovery in consumer demand for autos remains on track in the U.S.” In 2010, about 11.6 million vehicles were sold in the U.S., an 11% increase from 27-year lows posted in 2009.
AutoNation said its new-vehicle unit sales increased by 23% in the first quarter compared to a 20% gain throughout the industry.
Meanwhile, same-store new-vehicle sales increased by 20%. Revenue for new vehicles increased by 22% while that of used vehicles increased by 14%. In addition, the revenue for finance and insurance operations rose by 16% and there was a 6% gain for service and parts.