AutoNation

AutoNation, Inc.
Public
Traded as NYSE: AN
S&P 400 Component
Industry Car dealership
Founded 1996 (1996)
Founder H. Wayne Huizenga
Headquarters Fort Lauderdale, Florida, United States
Key people
 Mike Jackson
(Chairman, CEO and President),
Lance Iserman(COO)
Marc Cannon CMO and Executive Vice President
Revenue Increase US$ 21,609.0 million (2016)[1]
Increase US$ 21,534.6 million (2017)[2]
Increase US$ 889.5 million (2016)[1]
Increase US$ 843.4 million (2017)[2]
Increase US$ 430.5 million (2016)[1]
Increase US$ 434.6 million (2017)[2]
Total assets Increase US$ 10,060.0 million (2016)[1]
Increase US$ 10,271.5 million (2017)[2]
Total equity Increase US$ 2,310.3 million (2016)[1]
Increase US$ 2,369.3 million (2017)[2]
Website www.autonation.com

AutoNation is an American automotive retailer, which provides new and pre-owned vehicles and associated services in the United States.[3] The company was founded by Wayne Huizenga in 1996, and has more than 360 retail outlets.[4] Based in Fort Lauderdale, Florida, the company's Chairman and Chief Executive Officer is Mike Jackson, former President of Mercedes-Benz North America, and the Executive Vice President of Sales and Chief Operations Officer is Lance Iserman.

Company operations

From its headquarters in Ft. Lauderdale Florida, AutoNation manages its operations throughout the United States of over 26,000 employees. who sell and repair 35 different manufacturer brands in 15 states.[5] It is ranked #136 in the 2016 Fortune 500.[6] The company has a large internet presence, offering its entire inventory for online searching.[7]

Revenue by Product Category[8]

57%New vehicles
21%Retail used vehicles
15%Parts and service
4%Financing and insurance
1%Other

History

In 1981, Republic Industries was created, specializing in waste disposal by Robert Alpert of A&B Investors, Tom Fatjo, and Bill DeArman. H. Wayne Huizenga became Chairman of the Board in 1995.[9] Republic began its used auto sales initiative with the purchase of Auto Nation USA in 1997,[10] followed by Car Choice Inc.[11] Republic began opening AutoNation used megastores. CarMax brought a lawsuit against Republic for copyright and trademark infringement. Republic's sales for 1995 were $5.2 billion.[9]

In 1996, Republic began purchasing new car dealerships and offering long-term contracts to owners who joined the automotive division management team. Some dealers began seeking out Republic to sell their dealerships because of the long-term contracts. In 1996, Republic built twelve AutoNation locations.[9] Later that year, Alamo Rent A Car was acquired.[11] A 2-for-1 split in the company stock was also completed.

In 1997, Republic continued acquisitions in the car rental business with the purchase of National Car Rental, Spirit Rent-A-Car, Value Rent-A-Car, Snappy Car Rental, and EuroDollar Rent A Car. Huizenga had Republic start consolidating operations between new and used cars and its rental companies into one operation. Acquiring six Saturn dealerships in Arizona and Florida, Republic sold the dealerships to Saturn in 1997 because they did not generate enough sales despite being a successful brand.[9] Maroone Automotive Group of Buffalo, NY and Florida was acquired in 1997 for $200 million in Republic Stock.[10]

In an attempt to expand the company's electronic security division, the company offered to purchase ADT but the acquisition was terminated.[9] In October 1997, Republic sold off its electronic security division after failing to expand it with the attempted-purchase of ADT.

Republic Industries offered in July 1998 an IPO of its original core waste disposal business as Republic Services. From this sale of 36% of Republic Services, Republic Industries netted $1.4 billion. While CarMax had received a $50 million jury award in its lawsuit, it was overturned on appeal in 1998.[9] Drivers' Mart, a competitor, was purchased.[12] The remaining 64% of Republic Services was divested to Republic Industries shareholders in 1999.[9] The company's first Chief Executive Officer (CEO) was Steve Berrard, who resigned from the company in July 1999.[13] Mike Jackson, CEO, moved to spin off the car rental business as ANC Rental. AutoNation USA used car megastores, which lost $25 million the quarter before, were all closed down. Plans to brand all auto dealers as AutoNation were scrapped and a regional brand focus was instituted.[10]

In January 2003, Jackson was named chairman of the board, replacing Huizenga.[10] On October 24, 2005, the AutoNation building in downtown Fort Lauderdale suffered significant damage due to Hurricane Wilma.[14] The company has since transferred to another nearby building.

In 2006, Mike Jackson, CEO of AutoNation announced that his company would be reducing orders from General Motors, Ford and Chrysler in 2007. Jackson made the statement that the company would instead focus on selling BMW, Mercedes and Lexus vehicles due to anticipation of further market share loss by US automakers resulting in high dealer inventories.[15]

In 2009, AutoNation announced the AutoNation Payment Protection program, promising that the dealership will buy back any car at market value, should the owner lose their job.[16]

By 2011, AutoNation was the first auto retailer in the U.S. to sell a total of 8 million vehicles.[17]

In January 2013, AutoNation announced that it would replace localized brand names of its car retail operations with its own name. This re-branding across the US was supported and approved by the major automotive manufacturers, including GM, Ford, Chrysler, Nissan, Toyota, Honda, VW and Hyundai. It involved a total of 210 franchises operating under previously assigned local group names.[18] In May 2013, AutoNation partnered with Indy Car Series Champion Ryan Hunter-Reay to support his "Racing for Cancer" charity. This charity serves as a key component of the AutoNation charity program. The charity was founded as a 501(c)(3) charitable organization following the 2009 passing of the founder's mother due to colon cancer. By August 2013, AutoNation announced the sale of its 9 millionth vehicle. A record achievement for the industry.[19]

In January 2015, AutoNation announced that Mike Jackson would take an expanded role with Michael Maroone's retirement after over 15 years as President. Bill Berman became the new Chief Operating Officer as of February 4, 2015.[20] In June 2015, AutoNation retailed its 10 millionth vehicle.[21]

On April 11, 2017, USA Today wrote that AutoNation’s CEO Mike Jackson questioned the market value of Tesla, the maker of electric cars, by saying that Tesla is "either one of the great Ponzi schemes of all time or it’s gonna work out."[22] The previous day, Tesla passed General Motors as the most valuable American automotive manufacturer, measured by its market capitalization. Jackson also said, "Clearly General Motors is undervalued and Tesla is overvalued. Anybody can see that."[22]

In June 2017, AutoNation sold its 11 millionth vehicle. On November 2, 2017, AutoNation announced that Waymo, a developer of self-driving technology, enlisted AutoNation to maintain and repair their driverless vehicles fleet.[23]

Notes

  1. 1 2 3 4 5 "AUTONATION, INC. 2016 Annual Report Form (10-K)" (XBRL). United States Securities and Exchange Commission. February 11, 2017.
  2. 1 2 3 4 5 "AUTONATION, INC. 2017 Annual Report Form (10-K)" (XBRL). United States Securities and Exchange Commission. February 15, 2018.
  3. ↑ White, Joseph B., "One Billion Cars", The Wall Street Journal, pp. R1, April 17, 2006.
  4. ↑ Bradsher, Keith, "Huizenga Wants to Dominate the Market", The New York Times, pp. D1, March 6, 1997.
  5. ↑ Machan, Dyan. "AutoNation's Mike Jackson Steps on the Gas". U.S. Edition. Barrons.
  6. ↑ Fortune 500: AutoNation, Fortune, accessed June 2014.
  7. ↑ Tucci, Christopher L.; Afuah, Allan (2001). Internet Business Models and Strategies: Text and Cases. McGraw-Hill. p. 270. ISBN 0-07-239724-1.
  8. ↑ "U.S. Securities and Exchange Commission Filing". SEC Registration of Corporations. November 16, 2001.
  9. 1 2 3 4 5 6 7 "Republic Industries, Inc. Company History". Company Profiles. fundinguniverse.com. Retrieved 2009-11-03.
  10. 1 2 3 4 Broder-Singer, Rochelle (March 2003). "Over drive: AutoNation's founders set out to revolutionize the automotive retailing industry by sweeping up dealerships and creating a national brand. Instead, the industry changed AutoNation. In the end, it took two "car guys" CEO/Chairman Mike Jackson and President/COO Mike Maroone to rev up profits at the largest dealership group in the country (Cover Story)". South Florida CEO. Gale Group. pp. 1–8. Retrieved 2013-07-17.
  11. 1 2 Bagli, Charles V. (November 8, 1996). "In Alamo Deal, Republic Puts More Money On Used Cars". The New York Times. New York, NY: New York Times Company. p. D1. Retrieved 2009-11-04.
  12. ↑ Evarts, Eric C. (2002-03-18). "Dealers stay in driver's seat". Christian Science Monitor. Christian Science Monitor. Retrieved 2009-11-04.
  13. ↑ "Autonation Chief Executive Agrees to Step Down". The New York Times. Bloomberg News. July 1, 1999.
  14. ↑ Hoag, Christina, and Danner, Patrick (October 27, 2005). "Creatively coping with chaos: South Florida's hurricane-worn companies are making do to keep going despite a lack of offices". The Miami Herald. Archived from the original on February 18, 2007.
  15. ↑ Mann, Joseph. "Balancing Inventory". Sun Sentinel.
  16. ↑ Lago, Carlos. "AutoNation Unveils Payment Protection Program". WOT News. MotorTrend. Archived from the original on 2015-07-05.
  17. ↑ Kernen, Joe. "AutoNation Sells 8 million vehicles". CNBC video news. NBC News.
  18. ↑ Hemlock, Doreen, AutoNation to stamp dealerships with its brand name, Sun Sentinel, January 31st, 2013.
  19. ↑ Brinkman, Paul (August 2, 2013). "AutoNation hits 9 million vehicle sales milestone". South Florida Business Journal.
  20. ↑ Wilson, Amy (January 15, 2015). "AutoNation Mike Maroone to Retire". Automotive News.
  21. ↑ Hemlock, Doreen (May 1, 2015). "AutoNation - 10 million sales". Sun Sentinel. Retrieved 4 July 2015.
  22. 1 2 "AutoNation CEO: Tesla is a 'Ponzi scheme' or it'll 'work out'". USA TODAY. Retrieved 2017-04-20.
  23. ↑ https://www.nytimes.com/2017/11/02/business/waymo-autonation-driverless.html

Further reading

  • Flynn, Michael S. (March 2001). "The Economy, Competition, and the Retail Automotive Dealer" (PDF). Final Report. The University of Michigan Transportation Research Institute. Retrieved 2006-11-28.
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