It’s getting harder to sell cars, and that signals the auto industry is about to enter a period of decline, the departing CEO of the nation’s largest auto dealership chain said Friday.
Sales of new vehicles are expected to continue their downward slide since they hit record levels of 17.6 million units in 2016, AutoNation CEO Mike Jackson told CNBC’s “Squawk Box.” He is expecting 2019 sales to be around 16.8 million units.
The downturn over the next few years will be far more gradual than the sudden collapse seen about a decade ago during the financial crisis.
AutoNation reported earnings of $1.10 a share on Friday, missing Wall Street expectations, sending shares down 4 percent. The company’s stock has fallen almost 30 percent in the last year.
Jackson is stepping down in March. He’ll be succeeded by Carl Liebert, most recently chief operating officer of USAA, a financial services company. Liebert also was an executive vice president at Home Depot.
During Jackson’s 20 years at the helm, he helped transform a small collection of dealerships into the country’s largest automotive retailing chain, weathering downturns in the process.
“As they say in ‘The Godfather,’ this is the life we chose,” Jackson said. “Autos is a cyclical business. As far as investors are concerned, I don’t care whether it’s a manufacturer, supplier, retail, you don’t buy the stock at the end of the cycle. But that also creates a lot of opportunities which we’ve taken advantage of over the years and have always come out of downturns stronger than we went into them. And we intend to do that this time also.”