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AutoNation Reports 2008 Third Quarter Results of Operations

- Third quarter net loss from continuing operations of $1.40 billion, including $1.46 billion after-tax, non-cash goodwill and franchise impairment charges recorded under SFAS No. 142

- $0.25 per share net income from continuing operations in the third quarter, excluding goodwill and franchise impairment charges and other items

- The Company remains in compliance with all financial covenants in its debt agreements

FORT LAUDERDALE, Fla., Nov. 6 /PRNewswire-FirstCall/ -- AutoNation, Inc. (NYSE: AN), America's largest automotive retailer, today reported a 2008 third quarter net loss from continuing operations of $1.40 billion or $7.95 per share. In the quarter, the Company recorded non-cash charges for goodwill and franchise impairments of $1.46 billion after-tax. After adjusting for the impairment charges and certain other items disclosed in the attached financial tables, net income from continuing operations for the 2008 third quarter was $44 million or $0.25 per share, compared to $73 million or $0.37 per share in the prior year.

Third quarter 2008 revenue totaled $3.5 billion, compared to $4.5 billion in the year-ago period, driven primarily by lower new vehicle sales. In the third quarter, total U.S. industry new vehicle retail sales declined 31%, based on CNW Research data. In comparison, in the third quarter AutoNation's new vehicle unit sales declined 24%.

Commenting on the third quarter, Mike Jackson, Chairman and Chief Executive Officer, said, "The third quarter was negatively impacted by the credit crisis that escalated in September into a full blown credit panic. This created a credit freeze that broke consumer confidence and, along with a continued housing depression, accelerated the decline in the U.S. economy and auto retail market. As a result of the adverse market conditions and a decline in our stock price, we were required under accounting rules to record non-cash goodwill and franchise impairment charges in the third quarter. Notwithstanding the impairment charges, the Company remains in compliance with all of the financial covenants in its credit facilities and the indenture for its senior notes. Furthermore, despite these headwinds, AutoNation continues to generate solid cash flow as demonstrated by the $104 million reduction in non-vehicle debt during the quarter, and excluding the non-cash charges, AutoNation was solidly profitable in the third quarter. Year to date, debt reduction totals $589 million, $362 million of non-vehicle debt and $227 million of vehicle floor plan debt."

Looking forward, Jackson also stated, "We expect the rest of 2008 will continue to be challenging and foresee U.S. industry new vehicle sales for 2008 in the low 13-million unit level, an 18-year low. While at this time it is hard to predict new vehicle sales for 2009, the most conservative industry forecast is in the range of 12 million new vehicle units. Even at a 12 million new vehicle level, we are confident that AutoNation will remain profitable and in compliance with debt covenants."

During the third quarter of 2008, in response to changes in the automotive retail market, including the disproportionate decline in revenue and earnings from the Company's domestic franchises relative to its import and premium luxury franchises, AutoNation made changes to its management approach that divided its business into three operating segments.

AutoNation has added supplemental reporting which provides additional detail on the three operating segments: Domestic, Import, and Premium Luxury. The Domestic segment is comprised of stores that sell vehicles manufactured by General Motors, Ford, and Chrysler, the Import segment is comprised of stores that sell vehicles manufactured primarily by Toyota, Honda, and Nissan, and the Premium Luxury segment is comprised of stores that sell vehicles manufactured primarily by Mercedes, BMW, and Lexus.

Segment Results for the Quarter

-- Domestic - Domestic segment income (1) was $23 million compared to year-ago segment income of $54 million. Third quarter Domestic retail new vehicle unit sales declined 36%. In comparison, U.S. industry Domestic retail new vehicle unit sales declined 33% according to CNW Research.

-- Import - Import segment income was $53 million compared to year-ago segment income of $69 million. Third quarter Import retail new vehicle unit sales declined 18%. In comparison, U.S. industry Import new vehicle retail unit sales declined 26% according to CNW Research.

(1) Segment income is defined as operating income less floor plan interest expense

-- Premium Luxury - Premium Luxury segment income was $43 million compared to year-ago segment income of $56 million. Third quarter Premium Luxury retail new vehicle unit sales declined 14%. In comparison, U.S. industry Premium Luxury retail new vehicle unit sales declined 24% according to CNW Research.

For the nine-month period ended September 30, 2008, the Company reported net loss from continuing operations of $1.30 billion or $7.27 per share, compared to net income from continuing operations of $238 million or $1.16 per share in the prior year. After adjusting for the impairment charges and certain other items as disclosed in the attached financial tables, net income from continuing operations for the nine-month period ended September 30, 2008 was $159 million or $0.89 per share, compared to $226 million or $1.10 per share in the prior year. The Company's revenue for the nine-month period ended September 30, 2008 totaled $11.4 billion, down 14% compared to $13.2 billion in the prior year.

The third quarter conference call may be accessed at 11:00 a.m. Eastern Time today by phone at 888-769-8515 or via the Internet (audio webcast) at http://www.AutoNation.com by clicking on the "About Us" link then clicking on "Investors" and then "Webcasts." A playback of the conference call will be available after 12:00 (noon) p.m. Eastern Time November 6, 2008 through November 13, 2008 by calling 888-567-0381.

About AutoNation, Inc.

AutoNation, Inc., headquartered in Fort Lauderdale, Fla., is America's largest automotive retailer and has been named America's Most Admired Automotive Retailer by FORTUNE Magazine in five of the last seven years. A component of the Standard and Poor's 500 Index, AutoNation owns and operates 311 new vehicle franchises in 15 states. For additional information, please visit http://corp.AutoNation.com or www.AutoNation.com, where more than 80,000 vehicles are available for sale along with AutoNation's E-Vehicle program.

FORWARD-LOOKING STATEMENTS

Certain statements and information included in this release constitute "forward-looking statements" within the meaning of the Federal Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied in such forward-looking statements. Additional discussion of factors that could cause actual results to differ materially from management's projections, estimates and expectations is contained in the Company's SEC filings. The Company undertakes no duty to update its forward-looking statements.

NON-GAAP FINANCIAL MEASURES

The attached financial tables contain certain non-GAAP financial measures as defined under SEC rules, such as net income and diluted earnings per share from continuing operations, adjusted in each case to exclude certain items disclosed in the attached financial tables. As required by SEC rules, the Company has provided reconciliations of these measures to the most directly comparable GAAP measures, which are set forth in the attachments to this release. The Company believes that each of the foregoing non-GAAP financial measures improves the transparency of the Company's disclosure, provides a meaningful presentation of the Company's results from its core business operations excluding the impact of items not related to the Company's ongoing core business operations, and improves the period-to-period comparability of the Company's results from its core business operations.



                                AUTONATION, INC.
                UNAUDITED CONDENSED CONSOLIDATED INCOME STATEMENTS
                      ($ in millions, except per share data)

                                     Three Months Ended    Nine Months Ended
                                        September 30,        September 30,
                                       2008       2007      2008       2007

       Revenue:
         New vehicle                  $1,974.6  $2,634.4   $6,335.4  $7,615.0
         Used vehicle                    822.0   1,068.3    2,728.0   3,197.2
         Parts and service               612.1     642.7    1,895.6   1,919.0
         Finance and insurance, net      119.3     150.9      398.8     445.2
         Other                            15.4      17.0       49.8      51.0
       Total revenue                   3,543.4   4,513.3   11,407.6  13,227.4

       Cost of sales:
         New vehicle                   1,844.5   2,448.3    5,916.5   7,075.1
         Used vehicle                    754.0     981.3    2,496.9   2,916.7
         Parts and service               346.3     361.6    1,071.4   1,079.1
         Other                             6.7       8.0       22.1      21.2
       Total cost of sales             2,951.5   3,799.2    9,506.9  11,092.1

       Gross profit                      591.9     714.1    1,900.7   2,135.3

       Selling, general and
        administrative expenses          452.7     506.7    1,432.0   1,516.6
       Depreciation and amortization      22.7      22.0       68.4      64.0
       Goodwill impairment (1)         1,610.0       -      1,610.0       -
       Franchise rights impairment       141.4       -        146.5       1.0
       Other expenses, net                 2.8       0.1        3.2       0.6

       Operating income (loss)        (1,637.7)    185.3   (1,359.4)    553.1

       Floorplan interest expense        (19.8)    (32.9)     (66.2)    (96.4)
       Other interest expense            (20.9)    (29.6)     (69.3)    (82.4)
       Gain on senior note
        repurchases                       12.1       -         12.1       -
       Interest income                     0.7       0.8        1.5       2.6
       Other gains (losses), net          (2.3)     (0.9)      (2.9)      0.1

       Income (loss) from continuing
        operations before income
        taxes                         (1,667.9)    122.7   (1,484.2)    377.0

       Income tax provision (benefit)   (263.0)     46.1     (188.1)    139.1

       Net income (loss) from
        continuing operations         (1,404.9)     76.6   (1,296.1)    237.9

       Loss from discontinued
        operations, net of income
        taxes                             (7.8)     (4.5)     (14.1)    (10.9)


       Net income (loss)             $(1,412.7)    $72.1  $(1,310.2)   $227.0


       Diluted earnings (loss) per
        share:
         Continuing operations          $(7.95)    $0.39     $(7.27)    $1.16
         Discontinued operations        $(0.04)   $(0.02)    $(0.08)   $(0.05)

         Net income (loss)              $(7.99)    $0.37     $(7.35)    $1.10


       Weighted average common
        shares outstanding               176.7     197.5      178.2     205.6

       Common shares outstanding,
        net of treasury stock, at
        September 30                     176.9     183.9      176.9     183.9


    (1) The non-cash goodwill impairment charge is an estimate because we have
        not finalized the valuation of certain assets and liabilities. We
        expect to finalize this non-cash goodwill impairment amount during the
        fourth quarter of 2008, and any adjustment will be reflected in our
        results for the fourth quarter of 2008.



                                AUTONATION, INC.
                          UNAUDITED SUPPLEMENTARY DATA
                    ($ in millions, except per vehicle data)

           Operating Highlights             Three Months Ended September 30,
                                                                $         %
                                          2008       2007    Variance Variance
    Revenue:
      New vehicle                        $1,974.6  $2,634.4    $(659.8) (25.0)
        Retail used vehicle                 695.1     847.3     (152.2) (18.0)
        Wholesale                           126.9     221.0      (94.1) (42.6)
      Used vehicle                          822.0   1,068.3     (246.3) (23.1)
      Parts and service                     612.1     642.7      (30.6)  (4.8)
      Finance and insurance, net            119.3     150.9      (31.6) (20.9)
      Other                                  15.4      17.0       (1.6)
    Total revenue                        $3,543.4  $4,513.3    $(969.9) (21.5)

    Gross profit:
      New vehicle                          $130.1    $186.1     $(56.0) (30.1)
        Retail used vehicle                  70.7      87.8      (17.1) (19.5)
        Wholesale                            (2.7)     (0.8)      (1.9)
      Used vehicle                           68.0      87.0      (19.0) (21.8)
      Parts and service                     265.8     281.1      (15.3)  (5.4)
      Finance and insurance                 119.3     150.9      (31.6) (20.9)
      Other                                   8.7       9.0       (0.3)
    Total gross profit                      591.9     714.1     (122.2) (17.1)

    Selling, general and administrative
     expenses                               452.7     506.7       54.0   10.7

    Depreciation and amortization            22.7      22.0       (0.7)
    Goodwill impairment                   1,610.0       -     (1,610.0)
    Franchise rights impairment             141.4       -       (141.4)
    Other expenses, net                       2.8       0.1       (2.7)
     Operating income (loss)             (1,637.7)    185.3   (1,823.0)

    Floorplan interest expense              (19.8)    (32.9)      13.1
    Other interest expense                  (20.9)    (29.6)       8.7
    Gain on senior note repurchases          12.1       -         12.1
    Interest income                           0.7       0.8       (0.1)
    Other gains (losses), net                (2.3)     (0.9)      (1.4)
      Income (loss) from continuing
       operations before income taxes   $(1,667.9)   $122.7  $(1,790.6)

    Retail vehicle unit sales:
         New                               65,698    86,191    (20,493) (23.8)
         Used                              45,629    52,103     (6,474) (12.4)
                                          111,327   138,294    (26,967) (19.5)

    Revenue per vehicle retailed:
         New                              $30,056   $30,565      $(509)  (1.7)
         Used                             $15,234   $16,262    $(1,028)  (6.3)

    Gross profit per vehicle retailed:
         New                               $1,980    $2,159      $(179)  (8.3)
         Used                              $1,549    $1,685      $(136)  (8.1)
         Finance and insurance             $1,072    $1,091       $(19)  (1.7)



           Operating Highlights            Nine Months Ended September 30,
                                                                $         %
                                         2008       2007     Variance Variance
    Revenue:
      New vehicle                       $6,335.4   $7,615.0  $(1,279.6) (16.8)
        Retail used vehicle              2,285.6    2,552.3     (266.7) (10.4)
        Wholesale                          442.4      644.9     (202.5) (31.4)
      Used vehicle                       2,728.0    3,197.2     (469.2) (14.7)
      Parts and service                  1,895.6    1,919.0      (23.4)  (1.2)
      Finance and insurance, net           398.8      445.2      (46.4) (10.4)
      Other                                 49.8       51.0       (1.2)
    Total revenue                      $11,407.6  $13,227.4  $(1,819.8) (13.8)


    Gross profit:
      New vehicle                         $418.9     $539.9    $(121.0) (22.4)
        Retail used vehicle                235.1      277.7      (42.6) (15.3)
        Wholesale                           (4.0)       2.8       (6.8)
      Used vehicle                         231.1      280.5      (49.4) (17.6)
      Parts and service                    824.2      839.9      (15.7)  (1.9)
      Finance and insurance                398.8      445.2      (46.4) (10.4)
      Other                                 27.7       29.8       (2.1)
    Total gross profit                   1,900.7    2,135.3     (234.6) (11.0)

    Selling, general and
     administrative expenses             1,432.0    1,516.6       84.6    5.6

    Depreciation and amortization           68.4       64.0       (4.4)
    Goodwill impairment                  1,610.0        -     (1,610.0)
    Franchise rights impairment            146.5        1.0     (145.5)
    Other expenses, net                      3.2        0.6       (2.6)
     Operating income (loss)            (1,359.4)     553.1   (1,912.5)

    Floorplan interest expense             (66.2)     (96.4)      30.2
    Other interest expense                 (69.3)     (82.4)      13.1
    Gain on senior note repurchases         12.1        -         12.1
    Interest income                          1.5        2.6       (1.1)
    Other gains (losses), net               (2.9)       0.1       (3.0)
      Income (loss) from continuing
       operations before income taxes  $(1,484.2)    $377.0  $(1,861.2)

    Retail vehicle unit sales:
         New                             210,606    247,524    (36,918) (14.9)
         Used                            145,435    155,742    (10,307)  (6.6)
                                         356,041    403,266    (47,225) (11.7)

    Revenue per vehicle retailed:
         New                             $30,082    $30,765      $(683)  (2.2)
         Used                            $15,716    $16,388      $(672)  (4.1)

    Gross profit per vehicle retailed:
         New                              $1,989     $2,181      $(192)  (8.8)
         Used                             $1,617     $1,783      $(166)  (9.3)
         Finance and insurance            $1,120     $1,104        $16    1.4



                                         Three Months Ended  Nine Months Ended
            Operating Percentages          September 30,       September 30,
                                           2008(%)  2007(%)   2008(%)  2007(%)

    Revenue mix percentages:
      New vehicle                            55.7     58.4     55.5     57.6
      Used vehicle                           23.2     23.7     23.9     24.2
      Parts and service                      17.3     14.2     16.6     14.5
      Finance and insurance, net              3.4      3.3      3.5      3.4
      Other                                   0.4      0.4      0.5      0.3
                                            100.0    100.0    100.0    100.0

    Gross profit mix percentages:
      New vehicle                            22.0     26.1     22.0     25.3
      Used vehicle                           11.5     12.2     12.2     13.1
      Parts and service                      44.9     39.4     43.4     39.3
      Finance and insurance                  20.2     21.1     21.0     20.8
      Other                                   1.4      1.2      1.4      1.5
                                            100.0    100.0    100.0    100.0

    Operating items as a percentage of
     revenue:
      Gross profit:
         New vehicle                          6.6      7.1      6.6      7.1
         Used vehicle - retail               10.2     10.4     10.3     10.9
         Parts and service                   43.4     43.7     43.5     43.8
         Total                               16.7     15.8     16.7     16.1
      Selling, general and administrative
       expenses                              12.8     11.2     12.6     11.5
      Operating income (loss)                  NM      4.1       NM      4.2

    Operating items as a percentage of
     total gross profit:
      Selling, general and administrative
       expenses                              76.5     71.0     75.3     71.0
      Operating income (loss)                  NM     25.9       NM     25.9

      NM = Not Meaningful



                               AUTONATION, INC.
                         UNAUDITED SUPPLEMENTARY DATA
                   ($ in millions, except per vehicle data)

        Segment Operating Highlights      Three Months Ended September 30,
                                                                 $        %
                                          2008       2007    Variance Variance
    Revenue:
       Domestic                          $1,199.9  $1,723.1    $(523.2) (30.4)
       Import                             1,412.5   1,703.4     (290.9) (17.1)
       Premium luxury                       904.1   1,060.5     (156.4) (14.7)
       Corporate and other                   26.9      26.3        0.6    2.3
    Total revenue                        $3,543.4  $4,513.3    $(969.9) (21.5)


    *Segment income (loss)
       Domestic                             $23.1     $54.2     $(31.1) (57.4)
       Import                                52.7      68.9      (16.2) (23.5)
       Premium luxury                        43.3      55.7      (12.4) (22.3)
       Corporate and other               (1,776.6)    (26.4)  (1,750.2)
    Total segment income (loss)          (1,657.5)    152.4   (1,809.9)

    Add:  Floorplan interest expense         19.8      32.9      (13.1)

    Operating income (loss)             $(1,637.7)   $185.3  $(1,823.0)


    * Segment income (loss) is defined as operating income net of
      floorplan interest expense


    Retail new vehicle unit sales:
       Domestic                            19,561    30,353    (10,792) (35.6)
       Import                              35,820    43,908     (8,088) (18.4)
       Premium luxury                      10,317    11,930     (1,613) (13.5)
                                           65,698    86,191    (20,493) (23.8)



       Segment Operating Highlights       Nine Months Ended September 30,
                                                                 $       %
                                         2008       2007     Variance Variance
    Revenue:
       Domestic                         $3,985.1   $5,076.6  $(1,091.5) (21.5)
       Import                            4,471.3    4,911.6     (440.3)  (9.0)
       Premium luxury                    2,863.7    3,159.4     (295.7)  (9.4)
       Corporate and other                  87.5       79.8        7.7    9.6
    Total revenue                      $11,407.6  $13,227.4  $(1,819.8) (13.8)


    *Segment income (loss)
       Domestic                            $92.8     $167.9     $(75.1) (44.7)
       Import                              167.6      198.3      (30.7) (15.5)
       Premium luxury                      145.6      167.7      (22.1) (13.2)
       Corporate and other              (1,831.6)     (77.2)  (1,754.4)
    Total segment income (loss)         (1,425.6)     456.7   (1,882.3)

    Add:  Floorplan interest expense        66.2       96.4      (30.2)

    Operating income (loss)            $(1,359.4)    $553.1  $(1,912.5)


    * Segment income (loss) is defined as operating income net of
      floorplan interest expense


    Retail new vehicle unit sales:
       Domestic                           65,879     88,090    (22,211) (25.2)
       Import                            113,035    124,464    (11,429)  (9.2)
       Premium luxury                     31,692     34,970     (3,278)  (9.4)
                                         210,606    247,524    (36,918) (14.9)



    Brand Mix - New Vehicle
     Retail Units Sold
                                 Three Months Ended      Nine Months Ended
                                   September 30,            September 30,
                               2008(%)      2007(%)      2008(%)      2007(%)

    Domestic:
      Ford, Lincoln-Mercury     13.0         14.8         13.6         15.5
      Chevrolet, Pontiac,
       Buick, Cadillac, GMC     11.9         13.5         12.2         13.4
      Chrysler, Jeep, Dodge      4.8          6.9          5.5          6.8
      Domestic total            29.7         35.2         31.3         35.7

    Import:
      Honda                     13.8         13.1         13.8         12.5
      Toyota                    20.7         20.3         21.0         20.3
      Nissan                    13.3         11.7         12.4         11.5
      Other imports              6.7          5.8          6.4          6.0
      Import total              54.5         50.9         53.6         50.3

    Premium Luxury:
      Mercedes                   6.9          6.0          6.6          6.0
      BMW                        5.1          3.9          4.5          4.0
      Lexus                      2.4          2.6          2.7          2.7
      Other premium luxury
       (Land Rover, Porsche)     1.4          1.4          1.3          1.3
      Premium Luxury total      15.8         13.9         15.1         14.0
                               100.0        100.0        100.0        100.0



                                AUTONATION, INC.
                    UNAUDITED SUPPLEMENTARY DATA, Continued
                     ($ in millions, except per share data)


         Capital Expenditures / Stock   Three Months Ended  Nine Months Ended
                  Repurchases              September 30,      September 30,
                                            2008    2007      2008    2007

      Capital expenditures                  $55.7    $49.7   $97.2   $128.6
      Acquisitions                           $-       $3.4   $29.4     $4.2
      Proceeds from exercises of stock
       options                               $-       $3.3    $1.0    $91.9
      Stock repurchases:
        Aggregate purchase price             $-     $340.9   $54.1   $580.8
        Shares repurchased (in millions)      -       18.2     3.8     29.3



        Floorplan Assistance and   Three Months Ended     Nine Months Ended
                 Expense              September 30,         September 30,
                                   2008   2007 Variance  2008   2007  Variance

      Floorplan assistance earned
       (included in cost of sales) $17.9  $27.3  $(9.4) $58.2   $75.2  $(17.0)
      Floorplan interest expense
       (new vehicles)              (18.4) (32.8)  14.4  (63.9)  (96.2)   32.3

        Net inventory carrying
         cost                      $(0.5) $(5.5)  $5.0  $(5.7) $(21.0)  $15.3



       Balance Sheet and Other Highlights
                                           September     December   September
                                            30, 2008     31, 2007    30, 2007

      Cash and cash equivalents               $60.8         $33.0       $29.2
      Inventory                            $1,967.5      $2,262.0    $2,169.9
      Total floorplan notes payable        $1,899.1      $2,126.4    $1,981.4
      Non-vehicle debt                     $1,413.7      $1,775.8    $1,731.7
      Equity                               $2,127.8      $3,473.5    $3,476.8
      New days supply (industry standard
       of selling days, including fleet)    62 days       52 days     48 days
      Used days supply (trailing 30 days)   41 days       44 days     43 days



                                AUTONATION, INC.
                    UNAUDITED SUPPLEMENTARY DATA, Continued
                     ($ in millions, except per share data)

       Comparable Basis Reconciliations*
                                           Three Months Ended September 30,
                                                            Diluted Earnings
                                          Net Income (Loss)    Per Share
                                             2008     2007    2008    2007

         As reported                       $(1,412.7) $72.1  $(7.99)  $0.37

          Discontinued operations, net of
           income taxes                          7.8    4.5   $0.04   $0.02
         From continuing operations, as
          reported                          (1,404.9)  76.6  $(7.95)  $0.39

          Impairment of goodwill and
           franchise rights                  1,456.0    -     $8.24    $-
          Gain on senior note repurchases       (7.4)   -    $(0.04)   $-
          Income tax adjustments                 -     (3.4)   $-    $(0.02)

         Adjusted                              $43.7  $73.2   $0.25   $0.37



                                             Nine Months Ended September 30,
                                                              Diluted Earnings
                                            Net Income (Loss)    Per Share
                                              2008      2007    2008    2007

         As reported                        $(1,310.2) $227.0  $(7.35)  $1.10

          Discontinued operations, net of
           income taxes                          14.1    10.9   $0.08   $0.05
         From continuing operations, as
          reported                           (1,296.1)  237.9  $(7.27)  $1.16


          Impairment of goodwill and
           franchise rights                   1,459.1     -     $8.19    $-
          Gain on senior note repurchases        (7.3)    -    $(0.04)   $-
          Stock compensation expense
           adjustment                             3.2     -     $0.02    $-
          Income tax adjustments                  -     (12.0)   $-    $(0.06)

         Adjusted                              $158.9  $225.9   $0.89   $1.10

    * Please refer to the "Non-GAAP Financial Measures" section of the Press
      Release.



                                 AUTONATION, INC.
                            UNAUDITED SAME STORE DATA
                     ($ in millions, except per vehicle data)

             Operating Highlights           Three Months Ended September 30,
                                                                 $       %
                                             2008      2007  Variance Variance
    Revenue:
       New vehicle                         $1,966.0  $2,634.4  $(668.4) (25.4)
         Retail used vehicle                  690.3     847.3   (157.0) (18.5)
         Wholesale                            125.0     220.4    (95.4) (43.3)
       Used vehicle                           815.3   1,067.7   (252.4) (23.6)
       Parts and service                      609.5     642.7    (33.2)  (5.2)
       Finance and insurance, net             118.7     150.9    (32.2) (21.3)
       Other                                    4.6       5.6     (1.0) (17.9)
    Total revenue                          $3,514.1  $4,501.3  $(987.2) (21.9)


    Gross profit:
       New vehicle                           $129.3    $186.1   $(56.8) (30.5)
         Retail used vehicle                   70.3      87.8    (17.5) (19.9)
         Wholesale                             (3.2)     (1.4)    (1.8)
       Used vehicle                            67.1      86.4    (19.3) (22.3)
       Parts and service                      264.0     280.3    (16.3)  (5.8)
       Finance and insurance                  118.7     150.9    (32.2) (21.3)
       Other                                    5.4       5.9     (0.5)
    Total gross profit                       $584.5    $709.6  $(125.1) (17.6)


    Retail vehicle unit sales:
          New                                65,458    86,191  (20,733) (24.1)
          Used                               45,382    52,103   (6,721) (12.9)
                                            110,840   138,294  (27,454) (19.9)

    Revenue per vehicle retailed:
          New                               $30,035   $30,565    $(530)  (1.7)
          Used                              $15,211   $16,262  $(1,051)  (6.5)

    Gross profit per vehicle retailed:
          New                                $1,975    $2,159    $(184)  (8.5)
          Used                               $1,549    $1,685    $(136)  (8.1)
          Finance and insurance              $1,071    $1,091     $(20)  (1.8)



           Operating Highlights           Nine Months Ended September 30,
                                                                $        %
                                        2008       2007      Variance Variance
    Revenue:
       New vehicle                     $6,306.5   $7,615.0  $(1,308.5)  (17.2)
         Retail used vehicle            2,270.7    2,552.3     (281.6)  (11.0)
         Wholesale                        436.7      643.3     (206.6)  (32.1)
       Used vehicle                     2,707.4    3,195.6     (488.2)  (15.3)
       Parts and service                1,884.8    1,919.0      (34.2)   (1.8)
       Finance and insurance, net         397.1      445.2      (48.1)  (10.8)
       Other                               16.2       18.9       (2.7)  (14.3)
    Total revenue                     $11,312.0  $13,193.7  $(1,881.7)  (14.3)


    Gross profit:
       New vehicle                       $416.3     $539.9    $(123.6)  (22.9)
         Retail used vehicle              233.6      277.7      (44.1)  (15.9)
         Wholesale                         (5.5)       1.2       (6.7)
       Used vehicle                       228.1      278.9      (50.8)  (18.2)
       Parts and service                  817.6      838.2      (20.6)   (2.5)
       Finance and insurance              397.1      445.2      (48.1)  (10.8)
       Other                               17.4       19.3       (1.9)
    Total gross profit                 $1,876.5   $2,121.5    $(245.0)  (11.5)


    Retail vehicle unit sales:
          New                           209,822    247,524    (37,702)  (15.2)
          Used                          144,690    155,742    (11,052)   (7.1)
                                        354,512    403,266    (48,754)  (12.1)

    Revenue per vehicle retailed:
          New                           $30,056    $30,765      $(709)   (2.3)
          Used                          $15,694    $16,388      $(694)   (4.2)

    Gross profit per vehicle
     retailed:
          New                            $1,984     $2,181      $(197)   (9.0)
          Used                           $1,614     $1,783      $(169)   (9.5)
          Finance and insurance          $1,120     $1,104        $16     1.4



                                         Three Months Ended  Nine Months Ended
            Operating Percentages            September 30,     September 30,
                                            2008(%)  2007(%)  2008(%)  2007(%)

    Revenue mix percentages:
       New vehicle                            55.9     58.5     55.8     57.7
       Used vehicle                           23.2     23.7     23.9     24.2
       Parts and service                      17.3     14.3     16.7     14.5
       Finance and insurance, net              3.4      3.4      3.5      3.4
       Other                                   0.2      0.1      0.1      0.2
                                             100.0    100.0    100.0    100.0

    Gross profit mix percentages:
       New vehicle                            22.1     26.2     22.2     25.4
       Used vehicle                           11.5     12.2     12.2     13.1
       Parts and service                      45.2     39.5     43.6     39.5
       Finance and insurance                  20.3     21.3     21.2     21.0
       Other                                   0.9      0.8      0.8      1.0
                                             100.0    100.0    100.0    100.0

    Operating items as a percentage of
     revenue:
       Gross Profit:
          New vehicle                          6.6      7.1      6.6      7.1
          Used vehicle - retail               10.2     10.4     10.3     10.9
          Parts and service                   43.3     43.6     43.4     43.7
          Total                               16.6     15.8     16.6     16.1



                                 AUTONATION, INC.
            KEY CREDIT AGREEMENT COVENANT COMPLIANCE CALCULATIONS
                                September 30, 2008

    ($ millions)

    Income Statement Information for the
     last twelve months
    (October 1, 2007 - September 30, 2008):

    Net Income (Loss) from Continuing Operations                    $(1,245.7)

    Interest Expense                                                    187.8

    Income Tax Provision (Benefit)                                     (155.8)

    Depreciation and Amortization                                        94.7

    Stock-based Compensation Expense (SFAS No. 123R)                     21.5

    Impairment charges (including goodwill, franchise rights,
     and long-lived assets)                                           1,761.1

    EBITDA                                                              663.6

    Floorplan Interest Expense                                          (98.9)

    Adjusted EBITDA                                                    $564.7


    As of September 30, 2008:

    Funded Indebtedness (primarily comprised of current
     and long-term debt and letters of credit)                        1,497.5

    Vehicle Secured Indebtedness (Floorplan Payables)                 1,899.1

    Funded Indebtedness Including Floorplan                           3,396.6

    Shareholders' Equity                                              2,127.8

    Total Capitalization Including Floorplan                         $5,524.4


    Ratio of Funded Indebtedness/Adjusted EBITDA                         2.65
    Covenant                                              less than      3.00

    Ratio of Funded Indebtedness Including Floorplan/
     Total Capitalization Including Floorplan                            61.5%
    Covenant                                              less than      65.0%

SOURCE  AutoNation, Inc.
    -0-                             11/06/2008
    /CONTACT:  Marc Cannon of AutoNation, Inc., +1-954-769-3146,
Cannonm@autonation.com/
    /Photo:  http://www.newscom.com/cgi-bin/prnh/20001017/AUTONATIONLOGO
              AP Archive:  http://photoarchive.ap.org
              PRN Photo Desk, photodesk@prnewswire.com/
    /Company News On-Call:  http://www.prnewswire.com/comp/750525.html /
    /Web site:  http://corp.autonation.com
                http://www.AutoNation.com /
    (AN)

CO:  AutoNation, Inc.
ST:  Florida
IN:  AUT REA
SU:  ERN CCA

JT-DL
-- CLTH010 --
6765 11/06/2008 07:08 EST http://www.prnewswire.com

Media Contact

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Phone: 954.769.3146
cannonm@autonation.com

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