Asbury Automotive (ABG) 30 Jan 252024 Q4 Earnings call transcript

Company Profile

Participants

Chris Reeves	executive
David Hult	executive
Dan Clara	executive
Michael Welch	executive
John Murphy	analyst
Rajat Gupta	analyst
Jeffrey Lick	analyst
Ryan Sigdahl	analyst
Bret Jordan	analyst
David Whiston	analyst

Call transcript

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Greetings, and welcome to Asbury Automotive Group Fourth Quarter 2024 Earnings Conference call. [Operator Instructions].

As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Chris Reeves, Vice President of Finance and Treasurer. you. Thank

begin. may You

Chris Reeves

good and morning. operator, Thanks,

Earnings call As posted results be Automotive was recorded release on XXXX will issued earlier and website being for noted, Group's Asbury's replay is quarter Quarter Asbury our today's available to later and Welcome at press morning is this fourth The Call. this Fourth detailing afternoon. investors.asburyauto.com.

our Senior and today David Financial the Chief call President Dan open be questions. Clara, for will and Michael Chief Hult, Executive Operations; available up and of our President Participating any follow-up Senior our are Officer. President with conclusion Vice remarks, me and of the Welch, Vice we later questions Officer; At for our will

the likely contain Before remind we we begin, must today during forward-looking to call statements. you discussion the is that

other statements current forecasts projections, those to significant than include historical uncertainties. which subject which and may which in are are statements Forward-looking nature, financial expectations, of each are

XX-K actual the the For differ SEC information with our of to XX-Q for release our December these the certain from update filings to materially Form regarding earlier subsequently may and time any forward-looking risks issued disclaim time, results We please our from responsibility and today. expressly earnings on reports including to statements. year statements see cause filed quarterly a ended Form that XXXX

on be In addition, certain non-GAAP rules defined the call. discussed under financial may measures as SEC

to financial applicable As most website. measures non-GAAP by SEC comparable required the such GAAP reconciliations rules, provide on any directly we our measures of

our results. our quarter posted also website, presentation an investors.asburyauto.com have updated highlighting on We investor fourth

David? to over the Hult. my David it pleasure is Now hand CEO, call to our

David Hult

every The our of was XXXX. new be members translated same-store the of per and our a compared recent business of team. more work third guest and fourth XX% QX. our same-store increase and and to year-over-year Chris, fourth day good team proud new election, Welcome direct you, we morning, X% of striving to throughout reflection I an for quarter the earnings the After was hard experience. vehicle come in traffic our improve each up strong the to Their call. into performance work the quarter Thank results of profit saw with who efforts is vehicle for up $XXX sales and couldn't gross sequentially, quarter volume everyone. Overall,

somewhere In expect $X,XXX to vehicle XXXX, gross range. per $X,XXX in we profit vehicle new the

And Our volume in mid-XXXX. in is consistent our strategy performance given supply with the vehicles prioritizing shift over market. used vehicle in the challenges profitability in used

essentially row. increased was quarter profit of for are the vehicle in unit new backdrop pricing. when particularly set second flat, gross vehicle While our per create headwinds against overall on rising used which the a volume These incentives, results impressive

expect throughout We XXXX. to inventory challenges persist

how to proud I gross for parts Shifting was of to business. more deliver be On all-important and our our for team business results up couldn't operations came together pay segment the up same-store customer XX%. the basis, profit was And fixed quarter. XX%. outstanding service the a

our customer mid-single-digit discipline. operational in keenly Looking is ahead, cost growth In we we with parallel remain rate success, confident sustainable. for a on focused remain pay

a as fell consecutive profit XX% adjusted basis. an at Our SG&A percent cost coming quarter, of for in the second on gross

efficient, our results proud business done. While we are is make to of the not our more here work

guest We to more experience in deliver a continue to other evaluate manner. a opportunities efficient

experience, live member all early improve this feedback encouraged by service, in our the went and team guest to cost the has Tekion From new operators. the with pilot sales efficiency, potential October, simplify from a X-store lower per at Our to we're transaction. platform

in had XX% a revenue, million, profit consolidated gross XX.X%. and margin record up XX% $X.X Now the year-over-year, for up profit quarter. a of fourth of generated for our gross results a billion We $XXX

it was of an X.X%. X%. adjusted and a as margin SG&A delivered adjusted same-store adjusted operating basis. We all-store same-store all-store Our XX% of operating an a margin was on XX%, And percentage of profit adjusted gross

was adjusted Our and adjusted share million. per earnings our $XXX $X.XX EBITDA was

thank find solutions the company excited into our to momentum make and our we've built innovative Finally, members better. I'm team deliver to who you continue heading XXXX. about to

Now performance. Dan will discuss operational our Dan?

Dan Clara

thank David, and you, would also like good everyone. I Thank morning, team hard members. work and to our

You that make strong of a you. high service our Thank a difference level by providing powers results.

otherwise. dealerships going brands give Same-store as was new vehicles. which performance well of TCA General strong number on performance basis year-over-year includes Now as from unless driven updates up to a units and and Ford. Kia, X% Motors and our luxury revenue our by same-store a up stated I'm Starting year-over-year on were X%, some with Hyundai,

as the New performance was across down our Stellantis, average it portfolio in from last gross and broad substantially and time the strength typical luxury vehicle the A increase brands line sequential which $X,XXX, we fourth to per overcome in solid gross unit spoke was with pressure of year-over-year. relates a quarter. on profit the seasonality per helped

Our was same-store XX the of at new end December. days supply day

results. within $XX that time, prior used quarter At business. per vehicles. than to Used the are cycle. slightly higher was volume unit market Turning monitoring unit third Fourth the used the car supply XXXX. believe may strategy this We was our for profitability gross preowned conditions year prioritizing retail $X,XXX same down unit point in we shape quarter versus at which was

was days DSI quarter. supply Our used at the end same-store the XX of

year-over-year. of $X,XXX sequentially The We F&I. third F&I the XXXX. the vehicle of of in quarter improving earned headwind to the revenue $XX F&I over Shifting decrease contributed an $XX deferred retail TCA per PVR same-store

details the discussed the the impact it For half walk the reflecting in the per was in gross and additional the XXXX $X,XXX, financial rollout the will would per unit TCA. the total in F&I of have. you healthy front-end vehicle through on Michael past regarding our the we've timing third of first Koons Florida yield quarter, of impact PVR. several quarters, In

and to parts service. Moving

the excelled quarter. service As business David in mentioned, our parts and

was and parts gross service same-store Our up XX%. profit

expansion generated increased we the the For by This margin basis expansion XX.X%, growth. an basis points. XXX XXX driven segments, which was higher-margin of of our quarter, points a profitability profit of gross of contributed

in on breaking out visibility progress further our of provide being parts by made to like our and the operations I'd addition, the components fixed business. service In

and Our largest collision the we XX%. In customer up driven down pay X% gross of profitable X%, were Wholesale piece growth warranty, most by generated were of and XX%, business, profit respectively. portion recalls. parts and increased

gross total stores built our And performance we Our see in finally, momentum the year Eastern XXXX, increase year. year-over-year, XX,XXX is over posting for approximately X,XXX units pay, XXXX. We quarter, we in fourth sales and the last year-over-year. Clicklane stores a an to over a as approximately growth units Western to a units XX,XXX in X% strong retailed X% upon in customer through retail increase which their XX% continue profit well. new increase versus brought XX% This our sold

team Michael? as to members guest-centric hand for ability New view close differentiating most as will our I focus the vehicles automotive made financial now discuss Clicklane to the an once sell by I our will be efforts in the our sales. factor up this important performance. retailer. again to we Michael over gratitude XX% new my We hard-working of to our marketplace. expressing call

Michael Welch

Thank birthday. and happy Dan, you,

We are pleased fourth results. our quarter with

year in level great some year finish high And will a figures. quarter, way and I full into XXXX. the head first, financial the and put to at along discuss now execute teammates with the performance Our guest a our

proceeds termination Hurricane the million, to Adjusted in of adjusted discipline for quarter the percentage of from Adjusted million net the was and impairments, over quarter, of the XXXX the net Milton quarter. anticipate net as agility as $X $X We the of SG&A franchise. to XX%, profit a $XX the million mid-XXs. were third for of pleased We was percentage at For income to sequential and to improvement XXXX contain team's basis related SG&A $XXX losses on a came income percentage of income -- million EPS a fourth gross fourth excludes $X.XX a adjusted in by a asset tax, quarter. noncash and be cost. related the

path the vehicle of glide new our the in GPUs Given and business. projected investments

full anticipate Koons of to earnings. be likely the $XX are in million, in the offering These in along million adjusted full the The year of and rate $X.XX $X a The $X rollouts, million XXXX platform quarter for benefit pretax a or or generated diluted QX diluted levels adjusted to million with XXXX income $XX was the estimate our noncash noncash share. TCA TCA and market fourth be XX.X%, tax for the for per TCA a to includes approximately in $X.XX the $XX per year. which of was pretax year hit impact Florida QX. deferral quarter income We anticipate rate headwind vehicle volume share. to deferral million in XX.X%. increasing and tax we for We be

to We the benefit the small have a impact negative expect Koons. rollout after deferral and a to of flipping first the deferral of half year Florida before

peak XXXX. the to deferral expect in We occur

We impact to next have XX morning. outlined years presentation on website the EPS over posted estimated on our several the of Slide this the

illustrate product appendix included will TCA of and In and the We it our mechanics financials. to addition, single the cash we flows better how on of see GAAP. life this through cycle example with the a effect have an detail. hope has for Please deal TCA more

for Now operating moving of $XXX year flow full back adjusted to generated XXXX. the We cash our results. million

quarter liquidity line floor cash, year. used was and XXXX $XXX flow on We capital accounts, for total depending XXXX, auto. $XXX cash We and estate approximately on projects care the cash CapEx timing million several real XXXX. offset of both $XXX revolving credit Excluding $XXX spent plan comprised million of million both million purchases, ended significant facility, of we and Free for permitting. in availability and our expenditures on excluding and with investments, spend in the the anticipate

transaction ratio of end Our December. X.XXx leverage was adjusted at net the

allocation evaluate disciplined our ensure will grow again a close long-term both and in you remains our to of our of success. saying all concludes prepared approach. I we who capital are effective to one the working continually remarks. top opportunities and This thank teammates priorities, business with our current Finally, to

now to over and the take operator your We turn call will the Operator? questions.

Operator

[Operator Instructions].

with America. question comes from Our Murphy first John of Bank

John Murphy

result points good here. out know than of of specifically a of think seeing tease wanted I market just you here. strength ask lot Obviously, is I on seasonal seasonality of questions much were on benefit sequentially just But you out can the we're I kind much resilience GPUs. new don't how data focus and if But got GPUs fearing. of about bottoming maybe how that the -- David, here pricing more GPU people to and A and to this much is in the

how much this How much how point? mean I do you it off about was seasonality, leveling is reaching So think that?

David Hult

Thanks, it's a complicated John. It's answer. to great And obviously, question.

to X-day a at a that, have Within supply. have we're day look XX-day supply you we specifically would some new. stated referenced and XXXX our a off is of comparing that supply, Asbury and kind than have a I different. and that. different speak our around What on before, If I'll Asbury tell the numbers brands some almost past you, 'XX, state mix it supply everyone's I'll XX-day and it is in today this, that for again, company of and model I focused

Our years brand the over Almost last in and markets. their made years, the different, different we're doing. is all what were Asbury X in accretive mix was to the GPUs acquisitions we've

So better term. think lack that a above number we'll I of always for stay

floating happens. that supply, it's some optimistic us that difficult huge what backwards us. have. the As we the biggest so number a going I Stellantis brands have. future yet. with that were have up we our give material improve, the us of the some had future X%. a But [indiscernible] rooftops lot hit low is all have do get and were it's they're It's based year, with to the in other just do their they think in would be. a on to was the if which brands size and predict XX% going act the been of It not little not and to are being when there We're profit tailwind for we we that performed same, very year-over-year import We we fourth brands. gross quarter still and quarter but significantly And bit brands to the a enter and some into should day of in this a have good that average just impact together better a actually of Lexus believe

holds. to segments of has now. So each really have think lot our work put right it's they and of to mixed And there future I be and at calculate looking the what peers really the into what a brand

XX.X stable the more coming see little a in I new we And sit as entering we're more market. EVs pro think with where it's all situation of But shift benefits. today, is a age over our doing the these we which from business average to back slide have great old, see to here retaining up are administration, average we're the servicing them on over miles a can mean keeps we we're we we're deck, ICE and over. with is the car after some creeping a at the stores again, you bit the means and that warranty years a XX,XXX job XX in is XX, car now

which 'XX. we certainly sure. our get an to closer coming headwinds have will We're our the There Stellantis some So every we're will month, way be on optimistic that for impact fixing the issues, about business. excited

John Murphy

a on in just then second test. X-store the That's question very helpful. Tekion And

things improved, of is at lower all I'll efficiency a it's couple a experience mentioned and paraphrase improved, has consumer cost. You

don't you other is savings bit specifics I top potential what what into the more with And then to get your know, maybe drive versus about Tekion? can line little maybe business the like maybe a are DMS. So opportunity and delta

David Hult

I particulars, from much one switching XX%. too Yes. plug ons without by we large reduce getting our about CDK, is into to pickup you, tell would Tekion

you So you reduce that on. plug toll costs charge and for reduce those the DMS fees the

that's one savings cost there. So large

more a of the just lot transparent because you train heck one It is The is, software designed. more the and of onboard with the other easier to guests. makes someone it's Tekion with a and way efficient far

costs but the sign. At first few the be things our the rocky with productivity pilot of little the to there when to Tekion, X.X anyhow, per where in we're in now, some in because on than the up what day, fully slight, I material is -- a some end which employee months, SG&A software productivity others, of X bit be even savings rolled went application. a close earlier expect stores, numbers, the just you Our the out years years will from in mentioned a positive all more

X-store now. only from say getting associates. to feedback We're great early product too encouraged. So right We're very our

because leaders it service without the it onboard going the do to is teammates a take anywhere It adviser. technology of the X We to said, used a also can days us now Some else. guests so more empowers in our day handle efficient. to

it efficient, our use differentiator of to is and part big going going And us efficiency the for is raise our our create transparency our the to So going teammates. exciting us, level productivity software service. is Easy make to folks more to a really allowing is experience. the to increase make

John Murphy

I one just in. sorry, I'm if sneak could

that you're giving A just the of even January. mentioned in showroom and momentum that of I in just you the trying if continue might and burn exact transitory. maybe sort Trump somewhat understand seeing traffic might over but January? out that without to You general. just in lot be bump business if What time, seeing are mean into numbers, concern

David Hult

really just X last January days upon most January mixed And kind the worse geographics, of this been stores a and years We've from days for or lot our the weather. had it down supply, then shut X and brand. a than of depends states of lot is with with our multiple in of January like the kind weather. has

So that's impact going to us.

to burn business-friendly. it's new have parts to the don't increase be an Not January They we're over an But think seem They but month. and administration. days agenda. think a what take we're increase. so is with very dramatic, But an I we're you prior those sales with seeing which and far. can't, going encouraged seeing to out, slower you service If year. out traditionally in I seem

that is, to year in car strong Going of stable average age back but to say, where this would a has it the potential I the for be automotive industry. the fairly, a us certainly

John Murphy

my have I opinion. you in probably least in Yes. you, more guess few front a those at of of

Operator

Rajat Gupta from question JPMorgan. next Our comes with

Rajat Gupta

SG&A, Firstly, bit. on any very to number. a was I solid curious unpack the there's was little level that the definitely just if a XX% way

sales you have for fourth million, did sales you lost profit if And in quarter, some then your curious up could that payments the unpack got primarily you quarter. the not follow-up to gross If quarter up related assuming that on you it's given the $XX force of went our at leverage. million. that $XX have due TCA. like drove what just I'm had to I still fourth third versus look make to But SG&A that on CDK a sequential

David Hult

come quarter working Rajat, prior then reductions. cost this mentioned is we're start We David. and that can Michael on I'll in.

you're think was seeing fourth gross headwind incremental them, the the part part absolutely profit and us we get would I is a benefit not cost quarter it of Stellantis hurt every I of on SG&A. in but is major picking the and materially the incremental tell just increase it So dollar. you reductions, that for to in

So there's will, if for writes the could you that improve Stellantis us we an even opportunity more. when itself,

cost at on discipline. focused very expense pretty been we our We number. think personnel We've have good a

an have efficiency regarding conservative. over disciplined leaves well. operating associate, little a pretty of cost savings per our there bit our and And opportunity We being increase we've time been to which as

of would it bit different in -- there opportunity there that while looking side, was quarter, with from at results. there out a our better had looking So just was brand the the a was have job detail, a nice mix lot little

Michael Welch

but lot. the the a third your in quarter to for Rajat, little quarter and had CDK, whole not impact other question, bit second a

just both and helped increase and in that margins vehicle the savings So number. the the cost fixed new really, ops it's

Rajat Gupta

Got it. TCA. And on the follow-up just a

deferral us lot like provided higher. a had last headwinds you the it Just are quarter, looking at what looks

or higher cadence drag driving having just than why had 'XX just I'm it Is for what curious this growth higher for is higher a unit X that? rollout what's months claims. Now expectation ago? like you 'XX, and curious that

Michael Welch

Yes.

So off the and low the of year. at 'XX volume legacy up, from it's perfect kind 'XX LHM cumulative of point we're comes back of the SAAR. the of X-year storm a is And end, at early kind of for of as roll kind stores the kind this

And volume you're back. that so adding now

ending higher then good and LHM Koons on years and SAAR Florida on. rolling have of the vehicle used you and from growth, So expectations those

growing hit so the is and the a news deferral good have all on. kind coming years, And SAAR, from Koons lose and basically cars of you fully growing and old for you Florida used

Rajat Gupta

it. just solid a more last like F&I just like ancillary it's The Got that was it. curious Was follow-up, as nice the a drove just contract number. I'm stuff? penetration a non-service pretty And pretty headwind just Was like Got one. mix? contracts excluding there or increase on the numbers because that what acceleration.

Dan Clara

We to bottom on XX%. focus just our continue

and focus the the to moves. to continue that improvements We the to on extent we training that believe there, continue make number

team, training great job a but to history the to So great we've to got the and to team, job this continue field is trend.

David Hult

changed add finance in And lift sales, a in I to of payments little PBR. a a mix. probably cost the product That nothing as Rajat, the still just to and X/X bit. down coming far would with little bit as down and you gives your X/X reserve little has tailwind on It's a bit that. say the of sale

Operator

from with Stephens. is Jeff question Lick next Our

Jeffrey Lick

environment, to the happened just Congrats was a you little on that's QX. my of for And and the marginal more terms David, kind obviously, talk wondering kind put of in be the you to on extent more a GPUs sale could excited the SAAR you sale. fine that, I'm to curious happy more about a between that the as -- there's everyone's what obviously, the quarter could XXXX. wishes if more add going as inventory just to units Dan. not in profitable birthday just last of by pressure might spurred extend about need I on because are inventory. sell relationship

environment? Just inventory relationship we on the the any just thoughts GPU as in build there

David Hult

It But is of the supply, day years on. disciplined penalized on let's than that. day the circumstance, we more the past, even certainly, we the a with days which we're we in the you're than supply, tighter, lower keeping it are great. say, with But is compete our sense and being market. the don't the been the lot more that OEMs correlations just direct some OEMs because in go still The spot which higher within margin. there, A impacts our the market. have market Jeff, disciplined have us in still lower the to have

the the do markets our done domestic over really best really can. the And a we So they business. job fantastic that example as one do Motors with in there's of OEM job a And is -- key we days balanced is a partners supply the in that's time. where General to conversations supply always a day great managing

Jeffrey Lick

for I'd quick curious, written, follow-up, David. XXXX, in that's as at where relative do all I just under-appreciate what through expectations thing to as everything investment and understand a guess you've community you the questions of chance the you there's just biggest a variance or be being the to parse is kind listened the that XXXX? maybe look doesn't think

David Hult

our Sure. see subjective. used always as tailwind. start We few you a that benefit -- years to down to investor COVID, has optimistic. are to during of our of headwind peers. the that being Asbury because can vehicles huge 'XX. out the material have you a But in difference, what we'll a we our it's TCA. an has be been deck, happened believe, look But earnings us of against make road there It's -- in going a A There tend depletion there's a operator,

feel it we it is a high-margin in and the new going average As is the that strong. our our we The the of I in car, hear parts still to tell demand and lot it markets. service. 'XX, We with you have momentum There's age relates of administration. business believe up, positive can the would mile

have we gross be. profit revenue than numbers the grow potential the fixed numbers, our think I focus the then relevant and still where parts and the operations But of to business. should less service that's are

tell and consolidation would age fear at like look for kind That certainly can -- XXXX. being to So they're we've foreseen. a point a bit. built. pushed by what looks of think off is thrown is a about of consolidation on usual, The a when space like invert not with this fix be with and tailwind with industry generally and market everyone you, done else or of vehicle, always be happening more itself out time. their war EVs world sustainable Stellantis worse. I does, that's period going coming certainly the what seems would something us. that this will average it's a little I it some the with going upbeat it We're we've speaking, But that upbeat pretty Selfishly, we really to know at for

Jeffrey Lick

impressive of luck ] [ in and Great. XXXX. best quarter Well,

Operator

comes question Group. Capital next Our Sigdahl Craig-Hallum from with Ryan

Ryan Sigdahl

cetera. It cetera, of kind et to with back QX a trends, ICE, of sounds like cetera, lot et optimism et improved EV and switching seeing Trump

expected, lower a in on glide caught $X,XXX new last I GPU, decelerated That bit. was implies acceleration, GPU. that better outlook your it I on I guess, flatlined lower commentary it right, Given than for a pretty the big the GPU. if XXXX, path X vehicle little the were quarters $X,XXX to guess

that? you So what's seeing? currently of the I are what guess, what's -- Or cause

David Hult

year. to don't We XX, you're and and And little draconian. insight what point, anticipate beyond building what it's have well. probably adjust going going bit a Brian, this to right, SAR coming a trend, that they're the We upon number. like question. it's growing a And based for try new people fair fleet and how are the fair what's as XX days, little business look is SAAR a to inventory

at may in month. not is the the really one fourth happen the than tell see a mean potential that's time thing a And and this of November later would I March certain are just But space, that is. conservative It is you in is true a of month. it's year. quarter So the probably slower half it's year think bigger that go it. number I luxury. slower you month. until with in January by months about lift driven a we our the that seasonal. I in point first the just seasonality There is

So will But I hold short think PVRs time, term, bit. the hold may over the up -- will a better. little per unit adjust the gross up in it

in our it And that from of we're at the three dragging our And brands healthy And domestic import. when of mix number other a the number. the real two XX% domestic. doesn't mix PVR overall, is you a brand I really tell in look bad. And the standpoint, XX% look you down. about tables, about are a would

I opportunity legacy the the we and these made there's the some into with just mountain than going So as higher the will there. And are of what with said earlier, acquisitions we Asbury out was, franchises, states west domestic that GPUs future. and sustainable think stay

bit too happen, the the trying happen. for to really a aggressive not to what's predict first comments half may up, may it of in which probably the or year, little sum probably to just So going

to to that? want Michael, anything add you

Michael Welch

question normal. kind 'XX, early next new 'XX we shake mid but is, Yes. an late of to of when end I kind new mean where of more we to a me, that $X,XXX, for projection out The year is mid is normal. it up the at PVR -- that the as is of kind we of $X,XXX that's or think where think

Ryan Sigdahl

that clear, normal a be expect what on steady to you versus just is that's new the average for year. So state

Michael Welch

occurs when at 'XX. we up That's Correct. end. that where on Question mark the during end

Ryan Sigdahl

will the today for the -- point But are where be we starting the because that is average just higher Yes. that. year higher than

David Hult

Correct.

Ryan Sigdahl

like on. like it sounds don't of want going pricing I pretty et QX. one headwind to good. get to talk a know giving But more and and OEM nice a what's out improvements specific in Very too some lot but dealers made then big they've incentives, help And little Stellantis, it cetera, on help, feels a

to cycling get So I through made that Or churning getting and that place? kind in changes there? those was a the in guess, initiatives what were happen better just guess I fall, running kind and to it of given of the else needs

David Hult

and they high, inventory would still big throw which brought this as wrong tell which Ryan, the can day But our you just a out on but they was the peers us, great, inventory then competitors. David. I'll not Dan had is in. I is a supply of improvement. well, to and incentives and control, the down, jump start ground too lot we more way had

had still heavy with the vehicles right lot it's market that to incentives, very you the a really for of work so So through vehicles low selling weren't the GPUs.

of more right at with has sense As help right in potential equipment price with inventories we move the forward models the the GPU. to the the better right

upside the there's the vehicles down because the with there of more right that and the will equipment lot but them bringing Fourth growth desirable be inventories was selling consumer. demand. incentives, getting it higher really about more pushing right with a through quarter wasn't So to and inventory with highly

Dan Clara

there -- available that starting only turns was some Ryan, allows cars the the or to the see item order that would of which were We're I'm available sorry, what restrictions options wants the that restrictions some order. not and the on the lifted, only allocation is to Bret, add with had I consumer to an time those any we us faster.

from but not to were that term, volume short feel them, sentiment Stellantis the and market quick time. some to a going in, about shift going they is I products to because of being that talked that when overall with the -- we we're starts a being as overnight. is that. excited models that all There's but happen The stores, and back, brought from about lost to take operators also share kick some So Stellantis they that abandoned it's speak

got just just the we essentially -- leadership laid that fruition team level and comes need to around. at to So has store been put everything we out Stellantis to by as now execute it the

Ryan Sigdahl

Helpful. Thanks, and Dan. David. us. That's Michael, it birthday, happy for

Operator

Instructions]. [Operator

Our with Jordan Jefferies. next question comes from Bret

Bret Jordan

kind the continuing coming is question, [indiscernible] feel like demand if the from here one of are following is customer flatlining? mix guess and up time. of it step but inventory their Stellantis an more does I It's volumes more in to down bottomed on standpoint. with GPU not sort last line down, production

David Hult

question. I quarter overpriced point great really in a desirable. know the fourth was would pushing say and in future. to opinion, inventory way It's as the But was in my yes, through not the low No that the

should some there Dan, you? do from So upside be there.

Dan Clara

agree. I

Bret Jordan

strong. cost expansion on service, promotions But in customer appear then driving the customer sort It better you're the it given the what capacity post warranty? obviously, margins pay strength reaching the Okay. to? or Is that somehow And with really question doesn't a you per are strong. attribute pay do of

Dan Clara

There is the about we it -- has cycle start David add whole and being several year and about Bret, with start. missed. the in I'll I'll utilized Yes, already and talked this Dan. been of starts quarters I can whatever this about experience, in in all then ago guest tools were our proper inspection multipoint installed then we a legacy stores that stores. the that western that the

guest-centric efficient services part way you're just a of in there efficient in a a that seeing a consumer way approve service. them efficient to present to decline the to and more big to recommended is a inspect So or more more for the what cars, the more way

the to store that, retaining level is job doing addition a In good pretty customers.

our mentioned, average XX,XXX David miles. As mileage are

So with good the mileage, or expires. care maintenance and they're taken they be repairs the of and means job a items what need warranty comes that And after retaining that doing you. have to it that with higher break guest a

So and a it's of of more the guest a tools delivering experience. training, combination then and efficient execution much ultimately

David Hult

been you, difference the would tell business. add it adding eastern stores, and our I our in make we've people this And along last leadership hiring our to western had with into on great years, stores all in X.X that, the of fortunate some over top we've

that in of good leadership just our has new in still driving has come there's difference And is results. for made still material a really us. -- And upside the good news some better there's

without benefit the had tech a overall, our which adding we in X% but is headcount, still brick-and-mortar. space opportunity For us of year a lot increase to a we to grow have

on we're offer better And So material And again, a strides making us service, do. to in I that. can out level it's the team has of at impact you think see west. what had higher great we the get

Operator

David Next with Morningstar. question comes Whiston from

David Whiston

kind going if are whatnot. any tariff dealer, possibility as threats, of and do of I you're the sharing XX% you the On all you consumer plan the here or mean discussions have or Trump importer or the the contingency you have happens? to it just burden? the through it to Or cost it OEMs had eat have with either the pass on to

David Hult

David, in. others jump can Yes. and this is David

We with manufacturers haven't had yet. the conversations any

on of side. the it's the U.S., the early are think in A products I too import even lot made call. to

there well. We parts and the and business business have service out of car average there used the car out the is as with age healthy a

assume I we But I'm I of don't be something it's don't. the than out. pretend the understands day, should, is to how any going retail end going get itself more fear knowledge to think have to out. And worked always this GDP automotive to space it administration work I and is inside number. to one, the the because important tends I sure the at we

David Whiston

And concerns on of, guess, they because major reduction affordability about both and for really is affordability problem new feel a Or post in better used? election, consumers' have affordability you I still noticed post kind any election?

Dan Clara

issue David, quarter. pent-up place this there, uptick fourth it customers an more and like after much the was is is we we in and election. affordability but the demand David's positive Back still comment, question And feels did is see as it there saw is the took the up and Dan. are, sentiment to it,

David Hult

to by with better product opportunity in availability. would We than strong it's fourth a have I what had luxury. because And that were David, add quarter to We we the always the limited quarter did.

anything sell the handle The a there. some the have didn't the luxury. can margin, there they market of to up opportunity, see down can just or really was cases, which product are held demand In adversity and them, with else. more customers we luxury Our you was as

David Whiston

million And impairment the what for? noncash was $XX

Michael Welch

test through So at of year, do annual end our to year, we go the some stores. and have impairment the each

some kind on through we as went had west just had out stores. we those model that for some we impairments stores so And of the flow cash

five about year. this had stores So impairments

Operator

to of the now Hult the question-and-answer We've closing to David reached the session. call over I'd for like turn comments. back end

David Hult

today. call day. participation you -- Thank discussing a the forward This to the We QX with in and you, the your great talking appreciate future. look concludes operator. Have

Operator

today's concludes This conference.

and time, You may at you for disconnect participation. we your thank your lines this

We use cookies on this site to provide a more responsive and personalized service. Continuing to browse, clicking I Agree, or closing this banner indicates agreement. See our Cookie Policy for more information.