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Used Vehicles Push Sonic Automotive through Tough First Quarter

While harsh weath­er had neg­a­tive effects on deal­er net­work Sonic’s first quar­ter earn­ings, pre-owned, used car sales brought in some sun­shine. Son­ic Auto­mo­tive, Inc., one of the largest retail­ers in the coun­try, report­ed 2014 Q1 earn­ings down — $20 mil­lion ver­sus $21.7 mil­lion a year before. Con­tin­u­ing oper­a­tions earn­ings per dilut­ed share were $0.38 in Q1 2014 vs. $0.41 in Q1 2013; weath­er and expens­es that came from Sonic’s pre-owned store ini­tia­tive affect­ed earn­ings.

Used, pre-owned vehi­cles saw some very good num­bers dur­ing the first quar­ter of 2014:

• Son­ic expe­ri­enced an all-time record for its pre-owned unit sales, which reached 27,657.
• Record first quar­ter pre-owned gross prof­it of $40.7 mil­lion.
• Pre-owned unit sales per store per month reached 90 units dur­ing the first quar­ter.
• Q1 2014 fixed oper­a­tions rev­enue was up $22.1 mil­lion, or 7.5% over the pri­or year’s quar­ter.

“We con­tin­ue to demon­strate our abil­i­ty to oper­ate and grow in the pre-owned space at record lev­els, said Jeff Dyke, Sonic’s EVP of Oper­a­tions. “Com­pared to the pri­or year quar­ter, we were able to grow pre-owned unit sales by 4.5% and pre-owned gross prof­it by 7.0%.”

Two oth­er mar­ket­ing ini­tia­tives are start­ing to see results for Son­ic – its True Price pric­ing method­ol­o­gy and One-Son­ic One-Expe­ri­ence cus­tomer ser­vice pro­gram. The retail­er is con­fi­dent that ful­ly imple­ment­ing One-Son­ic One-Expe­ri­ence will offer the auto­mo­bile buy­ing com­mu­ni­ty a shop­ping expe­ri­ence that no oth­er com­peti­tor in the indus­try can offer.



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