Home | Business News | Browse by Publication | A | Automotive News

AutoNation chief: Detroit 3 making strides.

Article Excerpt
Byline: David Sedgwick, David Kushma, Lindsay Chappell

As CEO of AutoNation Inc., Mike Jackson runs the nation's largest group of auto dealerships. The public group's 257 dealerships are in 17 states, with a big presence in the key Sun Belt states of California, Texas and Florida.

Because of his company's prominence, Jackson's pronouncements on such issues as inventory, retail strategies and energy policy command the industry's attention. Jackson spoke with Editor David Sedgwick, Retail Editor David Kushma and Mid-South Bureau Chief Lindsay Chappell.

What is your industry forecast for 2007?

It's going to be a challenging year. The industry has been supported by very low interest rates, which stimulated the housing market and made everybody feel wealthier. That facilitated the purchase of high-ticket items.

Now we're going through the opposite. With rising rates, the speculative bubble in housing has been popped. We're going to have to go through an adjustment period this year. The shutdown of construction has had an immediate impact on pickup sales. Pickup trucks can't fully come back until the housing situation is clear again.

With the Detroit 3 facing up to capacity issues, I think they're going to take a more prudent view of incentives. They will let volume fall rather than do extreme incentive...