Lithia Gets Boost from Used-car Sales, but Chrysler Business Suffers

DETROIT - Used-car sales helped Lithia Motors Inc. post improved earnings and revenue during the fourth quarter, Automotive News reported. The dealership group said yesterday that it posted net income of $2.8 million, compared with a net loss of $1.5 million in the same period in 2008. Lithia also said it generated fourth-quarter revenue of $419 million, up 4.9 percent from $399 million in the same period the year before. Problems at Lithia’s biggest manufacturer partner, Chrysler Group, created severe sales challenges, according to the retailer’s report. Chrysler brands accounted for 23.7 percent of Lithia’s new-vehicle unit sales during the quarter, down from 35.9 percent of vehicle sales during the fourth quarter of 2008. “Our fourth-quarter results were impacted by weak new-vehicle sales at our Chrysler stores,” CEO Sid DeBoer said in a statement. “This was caused by the delay in the release of new products like the 2010 Ram heavy-duty pickup and lower advertising and incentive spending by Chrysler which slowed floor traffic.” DeBoer also said Lithia responded by focusing on increasing used-vehicle sales at the affected locations. “Excluding Chrysler, we had approximately 18.5 percent new-vehicle same-store sales growth over the fourth quarter of 2008,” he said in the statement. “On an adjusted basis, we were profitable in the fourth quarter despite significant headwinds.”