The cost-cutting initiative eliminates AutoNation’s central region. Texas and Colorado are now part of the company’s western region, and Illinois and Minneapolis are part of the eastern region, Cannon said. The company also cut corporate and regional jobs as part of the central region consolidation, he said, but did not disclose the number of jobs reduced overall.
The cuts will help enable AutoNation to further invest in its brand extension strategy and digital efforts, the company said in the statement.
The brand extension strategy — designed to keep the company profitable amid tightening new-vehicle margins — includes AutoNation auctions, standalone used-vehicle stores and collision centers and branded finance-and-insurance products, parts and accessories.
Through the first nine months of 2018, as new-vehicle margins slid and the company’s stock price dropped, AutoNation’s revenue inched up 1 percent from the year earlier to $16 billion, and net income rose 7.1 percent to $303 million.
AutoNation, of Fort Lauderdale, Fla., ranks No. 1 on Automotive News’ list of the top 150 dealership groups based in the U.S., with retail sales of 329,116 new vehicles in 2017.
The company’s stock price closed at $37.66 on Monday, up slightly from a month earlier, but down nearly $20 from Jan. 8, 2018.
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