There’s a consistent pattern in how the largest quoted US automotive retailers operate.

Different brands. Different geographies. Different management teams.

But when you step back, the same principles show up again and again - and they’re worth paying attention to.

Looking across the latest results from Asbury, Penske, Sonic, Group 1 - and now AutoNation and Carvana - what stands out isn’t one standout quarter or a single metric.

It’s a measure of how repeatable the model is.

This isn’t about one market being better than another. It’s simply about recognising what’s working - and thinking about what translates.

1. Growth Is Intentional

Asbury is probably the clearest example of this.

Revenue up 152% since 2020. EPS up 117%.

That hasn’t come from the market doing the work - if anything, new vehicle volumes have been under pressure for much of that period.

It’s been built deliberately:

• Acquisitions that actually move the dial
• A clear push into higher-margin areas like F&I and aftersales
• Cost and operational discipline that holds things together when volumes soften

You see the same thinking at AutoNation as well - less about chasing units, more about improving profitability per unit and growing higher-return areas like aftersales and finance.

The important bit isn’t the growth - it’s the quality of it.

Growth doesn’t just happen. It’s designed.

2. The Real Business Starts After the Sale

This is the structural point that comes through everywhere.

The initial vehicle sale isn’t where the economics sit. It’s where the relationship starts.

Across all of these businesses:

• After-sales continues to grow even when volumes don’t
• Customer pay and repair order value are increasing
• Finance penetration remains strong

AutoNation’s latest quarter is a good example - after-sales growing, customers paying up, and consistent margins despite softer volumes.

The model is built around capturing value across the lifecycle - not just at the point of sale.

The sale is the beginning, not the outcome.

3. Capital Allocation Isn’t an Afterthought

This is probably the biggest differentiator.

The US operators are very clear about where capital goes—and why.

You see it consistently:

• Strong free cash flow generation
• High cash conversion (AutoNation running at ~155%)  
• Ongoing share repurchases
• Disciplined leverage targets
• Capex tied to return

Even in a relatively flat revenue environment, they’re shrinking share count, improving per-share economics, and maintaining flexibility.

Carvana is a different model, but the same principle applies - growth paired with improving profitability and operating leverage, not just scale for its own sake. Record revenue (+52%) and EBITDA margins above 10% indicate a clear balance.

Strategy shows up in capital allocation, not just in presentations.

4. They Actively Shape the Portfolio

These businesses don’t just add.

They take things out as well.

Group 1 has been consistent here - exiting lower-return assets and reallocating to better opportunities.

AutoNation shows a slightly different version of the same idea - focusing capital on higher-return areas like finance (AN Finance scaling quickly) and aftersales rather than just adding more dealerships.

It all points to the same mindset:

• Not chasing scale for its own sake
• Being willing to move capital where returns are better
• Treating the portfolio as something dynamic

Building the portfolio matters. Managing it matters just as much.

5. The Model Is Built to Handle Pressure

The current environment makes this pretty clear.

Volumes are under pressure in parts of the market. Mix is shifting. EV dynamics are still evolving.

And yet - performance is holding up.

Because the model is set up for it:

• Recurring after-sales revenue
• Multiple profit streams
• Strong cash generation
• Balance sheet flexibility

Even where revenue is flat or slightly down, profitability per unit, per customer, and per share is improving.

That’s not accidental.

The best businesses aren’t built for perfect conditions - they’re built to cope when things aren’t.

So What’s Transferable?

Not everything.

Markets are different. OEM relationships are different. Customer behaviour is different.

But the principles carry.

• Be clear where the profit really comes from
• Treat capital allocation as something you manage, not react to
• Keep shaping the portfolio — don’t just let it drift
• Build around durability, not just growth

Final Thought

What stands out isn’t any one number.

It’s the consistency.

Same approach. Same discipline. Over time.

Across traditional dealer groups and newer models like Carvana, the common thread is the same:

A clear understanding of where value sits - and how to compound it.

The opportunity isn’t to copy another market.

It’s to take the parts that translate - and apply them properly.

Have a great week!