AutoNation Inc. had a strong performance in March with sales of 25,489 units, prompting the company to raise its 2012 industry sales prediction to the mid-14 million range. This 15% increase is believed to be the effect of the continuing revival of domestic brand automakers. AutoNation’s sales grew 13% for the first quarter.
The results were strong enough for the nation’s largest dealership group to help raise its outlook for the year from its former estimate of 14 million vehicles. AutoNation currently expects 2012 sales to range from 14.4 million to 14.7 million vehicles. When interviewed by CNBC, AutoNation CEO Mike Jackson said that AutoNation was “strong geographically everywhere.”
He added that sales are driven by the pent-up demand as its vehicles have an average age of 10.8 years. It helps that credit is ample and the product offerings are strong. He said that these vehicles have to be replaced.
Last March, AutoNation’s domestic-brand sales increased by 26% to 7,991 vehicles. Ford had led this group with a 25% increase. Its import-brand sales increased by 10% to 13,403 vehicles. Toyota was the leader with a 20% increase. In the meantime, Toyota and Honda inventories are continuously improving.
Luxury-brand sales went up by 10% to 4,095 vehicles. Jackson said that Mercedes led with an 18% improvement. He said that instead of hurting sales, the rising gasoline prices have actually been making sales accelerate even faster.
Since manufacturers have enhanced the fuel efficiency of vehicles ranging from trucks to small cars, consumers have found out that they don’t have to forget about size or performance to achieve a 20 to 30% improvement in fuel efficiency. He explained that they see the big gain that’s offered to them in fuel efficiency since the last time they checked it. Jackson said that this is why there is a “good reason to buy.”