Mike Jackson pushed AutoNation forward

AutoNation Inc.'s retiring CEO reflects on his years leading the nation's largest new-vehicle retailer.

September 27, 2021 12:00 AM

Outgoing AutoNation CEO Mike Jackson, right, once said he would remain at the helm until he reached the age of Roger Penske upon his competitor’s retirement. But Penske is still Penske Automotive Group CEO.

When Mike Jackson arrived at AutoNation Inc. in 1999 from Mercedes-Benz USA, the new CEO saw a company of diverse businesses — from franchised dealerships to used-car superstores and rental car operations — that were "thrown together through rapid acquisition" and lacked culture and purpose.

"I look at AutoNation today, and it's a brand that stands for something and has an extraordinary customer experience, a digital platform that is world class and the ability to execute profitably in a compelling way that has positioned AutoNation with tremendous success in the future," Jackson, who will retire from the company Nov. 1, told Automotive News last week.

By the time Jackson, 72, leaves the largest U.S. new-vehicle retailer to successor Mike Manley, former Fiat Chrysler Automobiles CEO, he will have led the company — after being recruited by its founder and business mogul Wayne Huizenga — for 22 years.

Mike Jackson

Title: AutoNation CEO
Age: 72
Retiring: Nov. 1
How he got started: As a technician at a Mercedes-Benz store, then became partner in Euro Motorcars in Bethesda, Md.
Automaker experience: Became senior vice president at Mercedes-Benz in 1990 and later CEO of Mercedes-Benz USA
AutoNation tenure: Became CEO in October 1999 and has been CEO and/or chairman or executive chairman ever since

"Mike did a lot for the business over his career, [having] grown the largest automotive dealer across the country," Stephens Inc. analyst Rick Nelson said. "Branding was a key strategy of his. They bought back massive amounts of stock over his tenure."

Jackson, an Automotive Hall of Fame honoree and repeat Automotive News All-Star, is known for catchy sound bites. Many in the industry pegged him as the voice of the dealer, someone unafraid to push back against automaker demands.

"He was very vocal about the manufacturing side of the business," Nelson said. "He railed against stair-step incentives, which harmed the consumer experience and pressured [gross profit per unit] for the auto dealers."

Started as a tech

Jackson began his career as a technician at a Mercedes-Benz dealership. At 29, he became a managing partner at the Euro Motorcars dealership in Bethesda, Md., and was CEO of Mercedes-Benz USA by the late 1990s.

Jackson's take

Outgoing AutoNation CEO Mike Jackson was never short of words. Here are some notable quotes in Automotive News through the years.

On the gasoline tax, published Oct. 3, 2005: "The government says, 'Eat your broccoli' while it subsidizes the price of doughnuts. The truth of the matter is: If you want people to smoke less, you tax cigarettes. If you want them to drink less, you tax alcohol. Guess what you should do if you want them to consume less gasoline? That's right: Tax gasoline."

On acquiring dealerships he felt were overpriced, published Jan. 18, 2010: "I'm proud to be a bottom fisher. If it's down to buying my stock back, I'm happy doing that all day long."

On automaker stair-step incentives, published Jan. 19, 2015: They "introduce a level of mistrust in the marketplace that's just incredible, and it's the retailer that the customer takes their frustration out on. They believe it's us that's created this game of three-card monte and hide the weenie. But it's really the manufacturer."

On Tesla's direct-sales efforts, published Jan. 19, 2015: Dealers fighting Tesla are "coming across as protectionists rather than free-enterprise guys. That's a mistake. You start a battle, who knows where it ends? So pick your battle carefully."

On rolling out his strategic vision for AutoNation, published Nov. 20, 2017: "I feel like the Cheshire cat. A period of significant, disruptive change is coming. I made my move years ago, and I like the way it's going to play out."

On dealers' longevity, published Nov. 26, 2017: "Disruption and revolution are coming to the auto industry — it's absolutely true — and it will affect suppliers, manufacturers and dealers. But dealers will not vanish."

On inventory and incentives, published Sept. 24, 2018: "The industry is massively inefficient in inventory management and incentive programs. The incentive programs are not what the consumer wants. I think it leads to a chaotic, unfair, disruptive, disorderly marketplace that consumers really don't like."

On Elon Musk, published Oct. 13, 2018: "I'm excited to sell electric vehicles. I never bought into Elon Musk's proposition that dealers can't sell internal combustion engines and electric vehicles out of the same facility. I never bought into that, and we intend to prove him wrong."

Early in his time at AutoNation, Jackson closed most of its 29 AutoNation USA used-car stores and converted the rest to new-car dealerships.

He killed plans for a national brand, though kept the idea close and bided his time until the 2013 rollout of the AutoNation moniker on all company dealerships, except luxury-brand stores.

Jackson later extended that brand name to auctions, aftermarket parts, and finance and insurance products. He brought back AutoNation USA used-vehicle stores, albeit with a smaller footprint. A large expansion of that used-only business is accelerating now.

He also helped raise $28 million for cancer research and treatment through AutoNation's Drive Pink initiative, which Jackson said united the company and created a "culture of caring." Huizenga and his wife, Marti, both died of cancer.

Under Jackson, AutoNation's stock price reached new highs this year. The retailer dramatically reduced its share count during Jackson's tenure, from some 375 million shares at the end of 1999 to 80 million at the end of June. Jackson often said he'd rather buy back company shares instead of buying dealerships he considered to be overpriced.

"I'm buying my own company," Jackson said of the strategy. "It's a statement of confidence and trust in the future of AutoNation, and it's created tremendous value for our shareholders and tremendous strength for the company."

Several analysts in research notes and interviews said they would miss Jackson.

"I've always loved Jackson's blunt style, [and] his crystal ball in terms of predictions on things like the [annual industry sales rate] tended to be very accurate," Morningstar analyst David Whiston said.

Building brands

Jackson, past chairman of the Federal Reserve Bank of Atlanta's board of directors and trustee emeritus for Nova Southeastern University in Fort Lauderdale, Fla., said he plans to devote time to the Horatio Alger Association of Distinguished Americans Inc., a nonprofit that aids youth facing adversity. Jackson, who is on the organization's board, received the Horatio Alger Award in 2014.

Jackson said he has enjoyed building brands and feels the most accomplishment from what he's achieved working with talented people at the retailer.

And now is a good time to leave AutoNation's helm, though Jackson once said he intended to remain CEO until he was the age of friend and competitor Roger Penske upon Penske's retirement. More than eight years later, Penske, 84, remains CEO of Penske Automotive Group Inc.

"I think the timing to hand the baton to Mike Manley is ideal," Jackson said. "I've done my part. I've climbed every mountain. I feel tremendous satisfaction with where the company is. And I'm excited that a new leader, with new energy and is day one ready, will seize the future with this company."