Retailers pumped up used-car sales in 2011
Top dealership groups, public and private, stepped up amid tight supplies
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Publicly held CarMax Inc., which specializes in used-vehicle sales, was by far the top retailer of used cars and light trucks in 2011, followed by a number of other publicly traded companies, according to data from the Automotive News list of the top 125 U.S. dealership groups.
Data compiled for the list show that privately owned retailers held the top spots in terms of used-vehicle retail sales per dealership and used-vehicle percentage sales gains last year.
Ranked by used-vehicle unit sales, the top of the list is almost unchanged. After CarMax, the next three are the top groups in new-vehicle sales as well: AutoNation Inc., Penske Automotive Group Inc. and Sonic Automotive Inc. The only change in the top 10 from the prior year's ranking of used-unit sales: Asbury Automotive Group moved past Hendrick Automotive Group to take the No. 7 spot.
It was a strong year for used-vehicle sales at the largest U.S. dealership groups. Of the top 125 groups, only 23 sold fewer used vehicles in 2011 than in 2010. (One other company was new to the list and did not provide year-earlier sales numbers.)
Leading the rise was privately held Mike Shaw Automotive. The Denver company's unit sales of used cars and light trucks surged 59 percent to 6,370 in 2011, the largest percentage gain among the 125 dealership groups.
The group ranks No.121 in new-vehicle sales, No. 70 in used-vehicle sales and No. 31 in used-vehicle sales per dealership at 796.
Last year President Mike Shaw stepped up the use of his own dealerships' Web sites and third-party classified Web sites to list used vehicles for sale. He also expanded use of the vAuto Inc. used-vehicle inventory management tool, which helped his group make sure it is stocking the right vehicles in each of its eight stores.
Shaw says some stores in his group have been using the inventory management tool since 2009, but his stores' general managers were not required to use it. But in 2011, the tool was implemented companywide -- no exceptions, he says.
"In '11 it became a hard policy: This is what we're going to do, how we're going to do it. No deviations," Shaw says of the tool. "You can see the results."
Dave Smith Auto Group of Kellogg, Idaho, ranks No. 110 in new-vehicle sales and No. 116 in used-vehicle unit sales. But the company ranks second, behind CarMax, in used vehicles retailed per dealership with 1,778 units. It increased its used sales last year 12 percent to 3,555.
Another big seller of used and new vehicles is Jim Koons Automotive Cos. of Vienna, Va., which ranks No. 16 in new-vehicle sales, No. 14 in used-vehicle sales and No. 10 in average used-vehicle sales per dealership. It increased its used-vehicle sales 6 percent last year to 19,592, or an average of 1,152 used units per dealership.
Tight supplies of some new vehicles because of the March 2011 earthquake in Japan caused many dealers to lean more heavily on their used-vehicle operations last year.
Take David Wilson Automotive Group in Orange, Calif., which ranks No. 14 in new-vehicle sales. Though its new-vehicle sales slid 4 percent, its used-vehicle sales improved 5 percent to 11,354 units, or 757 used cars and trucks per dealership. That put it at No. 31 in the ranking by used-vehicle sales.
President David Wilson says 14 of his 15 dealerships sell Japanese-brand vehicles. For a time after the Japanese disaster last year, those stores had few new vehicles to sell. Add the poor economy, and 2011 was a good year to beef up used-vehicle operations, Wilson said.
"We had to keep our salesmen and managers employed, so we were very aggressive at purchasing used cars because of the nonavailability of Toyota, Lexus, Honda and Acura," he says.
Wilson predicts that his used-vehicle sales will be about the same this year as in 2011, but "it will become a smaller percentage of our total sales because we expect to sell more new this year -- a lot more new."
| 2011 retail used-vehicle sales | ||
| Unit sales | ||
| Total used units sold | New-unit sales rank | |
| 1. CarMax | 396,181 | 77 |
| 2. AutoNation | 171,094 | 1 |
| 3. Penske Automotive | 129,652 | 2 |
| 4. Sonic Automotive | 102,874 | 3 |
| 5. Van Tuyl Group | 74,460 | 5 |
| Percentage gain | ||
| Total used units sold | % change vs. 2010 | |
| 1. Mike Shaw Automotive | 6,370 | 59% |
| 2. Tuttle-Click Automotive | 8,724 | 48% |
| 3. Piercey Automotive | 4,580 | 41% |
| 4. Greenway Automotive | 12,232 | 40% |
| 5. Day Automotive | 5,965 | 40% |
| Average used units sold per dealership | ||
| 1. CarMax | 3,846 | |
| 2. Dave Smith Auto | 1,778 | |
| 3. McCombs Automotive | 1,584 | |
| 4. Joe Machens | 1,482 | |
| 5. Reedman-Toll Auto World | 1,481 | |
| Source: Automotive News Top 125 Dealership Groups | ||
You can reach Arlena Sawyers at asawyers@crain.com.
