Sonic Automotive Inc.’s first-quarter net income soared 80 percent to $97.3 million despite a drop in used-vehicle sales from its growing EchoPark brand. The dealership group reported slight increase in retail sales at its expanding portfolio of franchised dealerships.
Revenue for the Charlotte, N.C., retailer rose 29 percent to $3.6 billion, a first-quarter record, Sonic said.
On the franchised dealership side, average gross profit per new vehicle more than doubled to $6,771 in the first quarter, Sonic said, while average gross profit per used vehicle also increased.
Sonic said total F&I gross profit per retail vehicle hit $2,495, an all-time quarterly record.
The group’s standalone EchoPark used-vehicle stores generated record first-quarter revenue of $625.3 million, but higher expenses led to a $34.9 million loss for the unit.
“Despite inventory constraints and inflation due to ongoing supply chain issues, we continue to see solid consumer demand for vehicle sales and parts and services throughout our business,” CEO David Smith said in a statement Thursday. “With these favorable trends and our continued focus on executing our long-term strategic growth plan for Sonic and EchoPark, we remain confident in reaching our stated goal of $28 billion in total revenues by 2025.”
Sonic made its first franchised dealership acquisitions in years in 2021, including the December purchase of RFJ Auto Partners Holdings Inc., one of the largest privately owned dealership groups in the U.S.
Sonic completed one acquisition in the first quarter, with the January purchase of Sun Chevrolet in Chittenango, N.Y., its first franchised dealership in the state.
Sonic also expanded its EchoPark brand in the quarter with the opening of a delivery center in Johnson City, Tenn., in March.
In April, Sonic opened an EchoPark delivery center in Columbus, Ga., and a retail hub in Raleigh, N.C., expanding the network to 38 locations.
Sonic shares closed down 0.8 percent Wednesday to $42.98.
Q1 revenue: $3.6 billion, up 29 percent from a year earlier
Q1 net income: $97.3 million, up 80 percent from a year earlier
Q1 vehicle sales: Franchised dealerships sold 51,680 new and used retail vehicles, up 1.2 percent. EchoPark stores sold 14,995 used vehicles, down 24 percent.
Records: First-quarter revenue, first-quarter pretax income from continuing operations, all-time quarterly total F&I gross profit per vehicle and first-quarter EchoPark revenue, among others.
Ranking: Sonic ranks No. 7 on Automotive News‘ list of the top 150 dealership groups based in the U.S., retailing 103,486 new vehicles in 2021.