CarShop’s second-quarter revenue increased 15 percent to $468 million on sales of 20,124 vehicles, up 7 percent.
Penske operated 21 CarShop outlets in the quarter, after it in May closed two small CarShop express locations in the U.K.
CEO Roger Penske said it’s tough to acquire vehicles for CarShop right now. The unit isn’t selling vehicles priced at $10,000 or less because of the amount of reconditioning they require and customer feedback. CarShop instead aims to stay in the $15,000 to $25,000 range.
“It’s very, very difficult to acquire cars at that [price] point,” Penske said. “So we’re just really at this point looking at cost and technology. And I think, even though, again, we did 20,000 units in the quarter, we just are not getting the margin.”
Penske said CarShop is doing fine at the store levels.
“When you add on all the technology and the other fixed costs we have, that’s what’s impacting our profitability,” he said. “But we’re fully engaged in the brand. We’re continuing to grow it.”
Penske said there likely will be new CarShop openings over the next six months.
“And we’re going to wait and see what happens in the market once this thing opens up and we have used availability,” he said.