Penske Automotive Group provided an operational update on its business on June 9, stating automotive retail business conditions have improved compared to March and April.
Penske Automotive Group CEO Roger Penske said he was encouraged by “the significant improvement we continue to see in our operations.”
“Since the COVID-19 pandemic began impacting operations in the second half of March, we took actions to reduce costs and preserve our liquidity position,” Penske said in a news release. “Based on these actions, I expect further improvements to our operating results in June and into the second half of the year as the economy continues to recover.”
All of Penske’s U.S. automotive retail dealership sales and service operations are open. Shelter-in-place orders had an impact on operations in April, with new and used unit sales declining approximately 50% and service and parts gross profit declining by 52% compared to April of last year.
The company said business conditions began improving in May. New and used unit sales declined approximately 25% compared to May of last year. They increased 60% sequentially from April to May of this year.
Compared to the same period last year, service and parts gross profit declined 39% in May. But from April to May of this year it increased 28% sequentially.
Penske reported its North American commercial truck dealership sales and service operations have remained open. New and used unit sales in April of this year were essentially flat compared to April of last year.
New and used unit sales declined 20% in May of this year compared to May of last year. That occurred as the Class 8 heavy-duty truck market adjusted from last year’s record level.
New and used units on a same-store basis declined 39% compared to April of last year. They declined 19% sequentially from April to May of this year.
The company reported service and parts gross profit remains strong. May fixed absorption remained above 120%, and from April to May of this year, repair orders per day increased 7% sequentially.
In the UK, in accordance with a government order, all dealerships closed March 24. Service and parts operations resumed during the middle of May, and for most of the UK, dealership showrooms re-opened on June 1.
Although the UK dealerships were closed, Penske remotely delivered approximately 2,500 vehicles in May. In addition, through e-commerce efforts, its UK dealership operations showed more than 4,000 vehicles sold and awaiting delivery at the beginning of June.