Mike Jackson, Chairman and CEO of AutoNation the largest car and truck retailer in America appeared on Fox Business from Phoenix Arizona during the company's national “re-branding campaign tour”. Mr. Jackson was pleased with the company’s performance over the past year with a 29% increase in stock price and that the change in the national branding of all the AutoNation stores was going so well. It will cntinue throughout the summer.
Liz Clamon business news analyst, asked Mr. Jackson about his view of the current economic conditions; and what where the contributing factors for AutoNation’s great performance?
Mr. Jackson responded. 'Well Liz, I think that the U. S. economy is genuinely is improving. While it has been on fiscal and monetary stimulus since 2008, now there are continuing significant bright spots in the areas of energy, housing, and the automotive industries that are based on "real fundamentals"'....
' Firstly [Liz] – “Fracking", invented by an Texas entrepreneur in the oil industry, has unlocked tremendous energy reserves in the United States which has provide the increase in production by 2 million barrels per day in in oil production ; This also has created much needed high paying jobs. Secondly – house prices have stabilized and are now rising. This has improved the conditions with the construction industry and there is now a brighter employment picture as we will build 1 million new homes this year. Finally – the U.S. car industry is providing the most advanced products ever to the American consumer; and is continuing its renaissance. This should remain in place for years.
'As a result of the crisis of 2008-2009 causing an almost complete stop of the purchase or repair of their vehicles for about 11 years, the U. S. consumer is now having to fix the car they have, or come in and talk to us to buy a new one. But whether it's a vehicle from Detroit, the Japanese, or the differentiated Germans, the customer never has had a better choice; from small cars through pickup trucks with improved fuel efficiencies, advanced design, quality fit and finish, as well as the availability of historically low interest rates.' This is what is fueling the continued strong performance.
Liz Clamon then asked Mike his view of energy prices for the summer. Mr. Jackson indicated that because of the increased production both in the U.S. and you can buy a barrel of oil from Canada for as low as $65 per barrel. consequently gasoline prices are “coming down” which is very unusual; " We are producing "summer blends which adds about 20-25 cents per gallon to the price of gasoline and prices are still falling. If this continues, by the Fall, prices should be even lower. '
"Well, we'll leave it there for now Mike"; it was good to see you in Phoenix where you are on your "rebranding campaign."
"Yes, Liz we're here in Phoenix with our billion dollar business, making the change in the branding of our stores in the Southwest; and are welcoming our latest additions; our new Honda and Hundai stores for the Phoenix area.'
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