With this morning’s release of Lithia’s third quarter 2014 earnings, we are able to update our graphs depicting the percent change in same-store used unit retail sales and gross margin for the seven publicly-traded dealership groups. Individual releases differed with respect to quarterly performance and future guidance (and produced differing market reactions), but aggregate results represented a continuation of trend.
The third quarter of 2014 marked the 21st consecutive increase in same-store used unit sales growth. The 2.8% increase during the quarter was the smallest in five years, but, as the string of consecutive gains lengthens, the year-over-year comps naturally represent an increasingly high hurdle. (With the aid of acquisitions, total used unit retail volumes for the seven groups increased 7% in the quarter and 8% for the first nine months of the year.)
Gross margins continued to narrow on a year-over-year basis, but higher throughput, good F&I income, increased operating efficiencies, and higher average transaction prices provided a beneficial offset.