Fourth largest US dealership owner Group One Automotive would consider buying more Ford dealerships, the company’s chief executive, Earl Hesterberg, told the Reuters Auto Summit in Detroit.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
The Houston-based firm had been more of a seller of dealerships than a buyer lately as it aggressively cut costs to adjust to the weak market, but it is now in a position to make some strategic deals, Hesterberg said.
“We’re pretty bullish on Ford,” he was quoted as saying.
“We would consider purchasing a Ford dealership if it were in a market where we thought we could grow that business.”
In strong Q3 results, Ford on Monday reported US$1.3bn of positive cash flow in the third quarter, its first positive quarter since the second quarter of 2007, and it also forecast positive cash flow for the fourth quarter. It burned through $4.7bn of cash in the first half of 2009.
Hesterberg said Group One was not considering buying any General Motors or Chrysler dealerships.
Chrysler needed to get some new products to the market as quickly as possible to generate some revenue and some fresh cash flow for the company, he said.
He was optimistic about GM’s Chevrolet, and noted the automaker was looking a bit better in terms of new product on the way, but it still had to finish sorting out its management team.
Ford dealerships make up 8% of Group One’s dealership sales. Toyota dealerships lead the way at 39%.
Hesterberg said Ford’s strategy to reduce its inventory early on was “a critical factor in what they’ve been able to accomplish.
“When they stopped jamming vehicles on us, that really gave me a big confidence boost in where they were heading.”
