America’s largest dealership group, AutoNation, posted declines in third-quarter net income and revenue after Hurricanes Harvey and Irma. The disastrous storms forced dealerships to close and damaged inventory in Florida and Texas. Despite the storm damage, the company continues to expand used car sales and accidents and collision division.
The retailer posted their storm-battered third-quarter results on Thursday. Net income slumped 9.1 percent to $97.5 million, and revenue slipped 2.4 percent to $5.43 billion. The back-to-back hurricanes forced 76 stores to close in Florida and disrupted locations in Houston for up to a week. CEO Mike Jackson stated that Hurricane Harvey and subsequent flooding destroyed up to 6 percent of the dealer group’s inventory in the Houston area.
At the same time, AutoNation managed to improve their used vehicle sales. Ironically, we suspect this was due in part to the post-storm surge in car purchases. AutoNation remains the largest used car retailer in the country. The company posted improved gross profit per unit and improved sales volume. The company also stated they would continue to expand their brand to cover accidents and vehicle repairs at more AutoNation Collision Centers and announced a servicing agreement with Google’s Waymo self-driving car division. Despite the temporary setback imposed by Hurricane Irma and Hurricane Harvey, shares rose 11.2 percent $52.95 as of Thursday morning.