AutoNation Inc., America’s largest retailer of new vehicles said a housing rebound will help make the auto market’s growth sustainable.
CEO Mike Jackson said he expects industry new vehicle sales to reach mid-14 million units in 2012. While that’s still below the 17 million of the mid-2000s, it’s a far cry from the industry’s downturn in 2009, when 10.4 million vehicles were sold.
“I think we’re on the journey back to 16 million units. The only question is the pace with which we get there,” Jackson told investors in a conference call.
Pent-up demand that has helped fuel the U.S. auto market’s growth since industry sales plunged to a 27-year low in 2009 is also starting to show in the housing market, Jackson said in a phone interview with Bloomberg.
“If you look at the sustainability of the automotive recovery, there are fundamental drivers there that are going to push through a weak economy,” Jackson said. “The same thing is about to happen in the housing industry.”
The company, which is based in Florida and operates 260 dealerships nationwide, said it earned $82 million in the quarter that ended June 30, compared to $73 million in the same period a year ago.
Second-quarter revenue increased 17 percent to $3.9 billion, and the number of new vehicles sold grew by 29 percent.
Total industry new vehicle sales increased 15 per cent in the second quarter, according to data compiled by CNW Research that was cited by AutoNation.