AutoNation 2003 Annual Report Download - page 30

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Table of Contents
Parts and Service
Years Ended December 31,
2003 vs. 2002 2002 vs. 2001
Variance Variance
Favorable/ %Favorable/ %
2003 2002 (Unfavorable) Variance 2001 (Unfavorable) Variance
($ in millions, except per vehicle data)
Reported:
Revenue $2,457.2 $2,453.3 $3.9 .2 $2,404.9 $48.4 2.0
Gross profit $1,072.2 $1,068.3 $3.9 .4 $1,039.2 $29.1 2.8
Same Store:
Revenue $2,411.4 $2,408.1 $3.3 .1
Gross profit $1,051.3 $1,048.7 $2.6 .2
Years Ended December 31,
% 2003 % 2002 % 2001
Reported:
Revenue mix percentage 12.7 12.6 12.0
Gross profit as a percentage of revenue 43.6 43.5 43.2
Same Store:
Revenue mix percentage 12.7 12.6
Gross profit as a percentage of revenue 43.6 43.5
Parts and service revenue is primarily derived from repair orders for service labor and related parts paid directly by customers or via
reimbursement from manufacturers and others under warranties. Total parts and service revenue and gross profit remained relatively flat in
2003 compared to 2002. This was driven by improved pricing on customer-paid work offset by decreases in warranty repair orders, wholesale
parts and our collision repair business. Significant decreases in domestic warranty repair orders offset import and luxury increases realized in
2003. In 2004, we will remain focused on improving customer-pay revenue and gross profit through initiatives that include implementing a
standardized service process, optimizing our pricing for commonly performed vehicle services and repairs for like brand vehicles within each
of our markets and using our standardized marketing communications with our customers. Revenue and gross profit in 2002 were impacted
by reduced warranty volume from domestic manufacturers, and a soft collision repair market. The year 2001 included a large manufacturer
recall.
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