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AutoNation Reports 2009 Third Quarter Results of Operations

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  • AutoNation reports solid earnings per share of $0.36, despite substantially lower new vehicle industry volume compared to prior year third quarter
  • AutoNation responds to recovering environment with increased investment plans, including capital expenditures, share repurchases and acquisitions

FORT LAUDERDALE, Fla., Oct. 29 /PRNewswire-FirstCall/ -- AutoNation, Inc. (NYSE: AN), America's largest automotive retailer, today reported net income from continuing operations of $65 million or $0.36 per share for the third quarter of 2009, compared to a net loss from continuing operations of $1.40 billion or $7.90 per share for the same period in 2008. In the third quarter of 2008, the Company recorded non-cash charges for goodwill and franchise impairments of $1.46 billion after-tax. Net income from continuing operations for the 2009 third quarter improved 44% on a per-share basis, as compared to adjusted net income from continuing operations of $44 million or $0.25 per share for last year's third quarter, which excludes the impairment charges and certain other items disclosed in the attached financial tables.

Commenting on the third quarter, Mike Jackson, Chairman and Chief Executive Officer said, "AutoNation delivered solid profitability driven by margin recovery, cost reduction, lower interest expenses a disciplined operating model and inventory management. Our third quarter profitability improved from third quarter 2008 despite substantially lower new vehicle industry volume compared to last year. Cash for Clunkers was a highly effective stimulus program that provided a much needed lift in auto sales and has set the stage going forward for a gradual recovery of new vehicle sales. The program aided our third quarter results by an estimated 7 cents per share."

Jackson also stated, "We expect that the automotive retail market will remain challenging throughout the remainder of 2009 with a gradual recovery beginning in 2010. We are optimistic for the long term prospects of the auto industry based on the successful restructuring of the domestic auto industry, the move to a demand pull system, and the rationalization of the dealer network. As the U.S. economy, consumer confidence and credit markets improve, we expect to be well-positioned to capitalize on these trends."

The Company's third quarter 2009 revenue totaled $2.9 billion, compared to $3.4 billion in the year-ago period, driven primarily by lower vehicle sales, in an environment where industry new vehicle sales remain at depression levels. AutoNation's new vehicle unit sales decline was in line with the industry's new vehicle retail sales decline, based on CNW Research Data.

AutoNation has 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 $34 million compared to
        year-ago segment income of $25 million.  Third quarter Domestic retail
        new vehicle unit sales declined 11%.
    --  Import -Import segment income was $63 million compared to year-ago
        segment income of $52 million.  Third quarter Import retail new vehicle
        unit sales declined 12%.

    --  Premium Luxury -Premium Luxury segment income was $44 million compared
        to year-ago segment income of $43 million. Third quarter Premium Luxury
        retail new vehicle unit sales declined 19%.

Notably in the quarter, Domestic and Import segments were the biggest beneficiary of the Cash for Clunkers program, which was concentrated in smaller fuel efficient vehicles retailing for less than $45,000.

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

Additionally, the Company's Board of Directors has approved a 65% increase in capital expenditures to $150 million for 2010 and has authorized an additional $250 million for the repurchase of its common stock. The Company repurchased 3.7 million shares of common stock in the third quarter for an aggregate purchase price of $65.8 million (average purchase price per share of $17.81). AutoNation also recently announced the acquisition of Honda and Acura dealerships in its AppleWay market in Spokane, Washington, which the Company expects to complete before the end of the year. Commenting on the Board authorization, AutoNation Chairman and Chief Executive Officer Mike Jackson said, "Investing in our facilities, investing in our stores through process and technology, repurchasing shares, and making strategic acquisitions reflects the Board's and senior management's continued confidence in AutoNation's financial strength and focus on generating additional value for shareholders."

For the nine-month period ended September 30, 2009, the Company reported net income from continuing operations of $172 million or $0.96 per share, compared to a net loss from continuing operations of $1.29 billion or $7.22 per share in the prior year. After adjusting for the impairment charges and certain items as disclosed in the attached financial tables, net income from continuing operations for the nine-month period ended September 30, 2009, was $155 million or $0.87 per share, compared to $158 million or $0.88 per share last year. The Company's revenue for the nine-month period ended September 30, 2009 totaled $7.9 billion, down 26% compared to $10.8 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 (pass code: AutoNation), or via the Internet (audio webcast) at http://www.AutoNation.com by clicking on "About AutoNation" and then "Webcasts & Presentations." A playback of the conference call will be available after 12:00 (noon) p.m. Eastern Time October 29, 2009 through November 07, 2009 by calling 866-487-7599, pass code: 75300.

About AutoNation, Inc.

AutoNation, Inc., headquartered in Fort Lauderdale, Fla., is America's largest automotive retailer. A component of the Standard and Poor's 500 Index, AutoNation owns and operates 245 new vehicle franchises in 15 states. For additional information, please visit http:///www.AutoNation.com, where more than 70,000 vehicles are available for sale.

FORWARD-LOOKING STATEMENTS

This news release contains both historical and forward-looking statements. All statements other than statements of historical fact, including statements that describe our objectives, plans or goals, are, or may be deemed to be, forward-looking statements under the securities laws. These forward-looking statements reflect our current expectations concerning future results and events, and they involve known and unknown risks, uncertainties and other factors that are difficult to predict and may cause our actual results, performance or achievements to be materially different from any future results, performance and achievements expressed or implied by these statements. These risks, uncertainties and other factors include, among others: economic conditions generally; conditions in the credit markets and changes in interest rates; assumptions and expectations relating to financial covenants contained in our debt agreements; the success and financial viability of vehicle manufacturers and distributors with which we hold franchises; factors affecting our goodwill impairment testing; natural disasters and other adverse weather events; restrictions imposed by vehicle manufacturers; the resolution of legal and administrative proceedings; regulatory factors affecting our business; and other factors described in our news releases and filings made under the securities laws, including, among others, those set forth under "Item 1A. Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2008 and in our Quarterly Reports on Form 10-Q. We undertake no obligation to update any forward-looking statements to reflect subsequent events or circumstances.

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, we have provided reconciliations of these measures to the most directly comparable GAAP measures, which are set forth in the attachments to this release. We believe 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,
                                      2009       2008      2009       2008
                                      ----       ----      ----       ----

      Revenue:
        New vehicle                $1,628.1   $1,891.2  $4,158.6   $6,039.6
        Used vehicle                  642.2      768.4   1,869.5    2,546.2
        Parts and service             537.9      570.9   1,616.0    1,765.9
        Finance and insurance, net     95.7      113.9     261.9      379.6
        Other                          11.8       14.9      36.8       48.1
                                       ----       ----      ----       ----
      Total revenue                 2,915.7    3,359.3   7,942.8   10,779.4
                                    -------    -------   -------   --------

      Cost of sales:
        New vehicle                 1,508.4    1,766.0   3,878.8    5,638.8
        Used vehicle                  582.5      704.2   1,687.6    2,328.2
        Parts and service             304.1      322.8     908.6      996.5
        Other                           5.7        6.5      16.3       21.2
                                        ---        ---      ----       ----
      Total cost of sales           2,400.7    2,799.5   6,491.3    8,984.7
                                    -------    -------   -------    -------

      Gross profit                    515.0      559.8   1,451.5    1,794.7

      Selling, general and
       administrative expenses        380.1      423.3   1,099.9    1,338.2
      Depreciation and
       amortization                    19.4       21.3      58.5       64.0
      Goodwill impairment                 -    1,610.0         -    1,610.0
      Franchise rights impairment         -      127.4       1.5      127.4
      Other expenses (income), net     (3.1)       2.5     (23.6)       2.9
                                       ----        ---     -----        ---

      Operating income (loss)         118.6   (1,624.7)    315.2   (1,347.8)

      Floorplan interest expense       (7.6)     (18.3)    (26.7)     (61.1)
      Other interest expense          (10.2)     (20.9)    (32.5)     (69.3)
      Gain on senior note
       repurchases                      0.5       12.1      13.0       12.1
      Interest income                   0.3        0.7       0.9        1.5
      Other gains (losses), net         2.2       (2.2)      4.0       (2.9)
                                        ---       ----       ---       ----

      Income (loss) from
       continuing operations
       before income taxes            103.8   (1,653.3)    273.9   (1,467.5)

      Income tax provision
       (benefit)                       39.0     (257.5)    102.1     (181.7)
                                       ----     ------     -----     ------

      Net income (loss) from
       continuing operations           64.8   (1,395.8)    171.8   (1,285.8)

      Income (loss) from
       discontinued operations,
       net of income taxes              0.2      (16.9)    (35.5)     (24.4)
                                        ---      -----     -----      -----


      Net income (loss)               $65.0  $(1,412.7)   $136.3  $(1,310.2)
                                      =====  =========    ======  =========


      Diluted earnings (loss)
       per share:
        Continuing operations         $0.36     $(7.90)    $0.96     $(7.22)
        Discontinued operations          $-     $(0.10)   $(0.20)    $(0.14)

        Net income (loss)             $0.36     $(7.99)    $0.76     $(7.35)


      Weighted average common
       shares outstanding             179.2      176.7     178.4      178.2

      Common shares outstanding,
       net of treasury stock, at
       September 30                   175.6      176.9     175.6      176.9



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


          Operating Highlights            Three Months Ended September 30,
          --------------------       -----------------------------------------
                                     2009       2008    $ Variance  % Variance
                                     ----       ----    ----------  ----------


    Revenue:
      New vehicle                 $1,628.1   $1,891.2     $(263.1)      (13.9)
        Retail used vehicle          563.3      648.0       (84.7)      (13.1)
        Wholesale                     78.9      120.4       (41.5)      (34.5)
                                      ----      -----       -----
      Used vehicle                   642.2      768.4      (126.2)      (16.4)
                                     -----      -----      ------
      Parts and service              537.9      570.9       (33.0)       (5.8)
      Finance and insurance, net      95.7      113.9       (18.2)      (16.0)
      Other                           11.8       14.9        (3.1)
                                      ----       ----        ----
    Total revenue                 $2,915.7   $3,359.3     $(443.6)      (13.2)
                                  ========   ========     =======


    Gross profit:
      New vehicle                   $119.7     $125.2       $(5.5)       (4.4)
        Retail used vehicle           57.7       66.5        (8.8)      (13.2)
        Wholesale                      2.0       (2.3)        4.3
                                       ---       ----         ---
      Used vehicle                    59.7       64.2        (4.5)       (7.0)
                                      ----       ----        ----
      Parts and service              233.8      248.1       (14.3)       (5.8)
      Finance and insurance           95.7      113.9       (18.2)      (16.0)
      Other                            6.1        8.4        (2.3)
                                       ---        ---        ----
    Total gross profit               515.0      559.8       (44.8)       (8.0)

    Selling, general and
     administrative expenses         380.1      423.3        43.2        10.2

    Depreciation and amortization     19.4       21.3         1.9
    Goodwill impairment                  -    1,610.0     1,610.0
    Franchise rights impairment          -      127.4       127.4
    Other expenses (income), net      (3.1)       2.5         5.6
                                      ----        ---         ---
      Operating income (loss)        118.6   (1,624.7)    1,743.3

    Floorplan interest expense        (7.6)     (18.3)       10.7
    Other interest expense           (10.2)     (20.9)       10.7
    Gain on senior note
     repurchases                       0.5       12.1       (11.6)
    Interest income                    0.3        0.7        (0.4)
    Other gains (losses), net          2.2       (2.2)        4.4
                                       ---       ----         ---
      Income (loss) from
       continuing operations before
       income taxes                 $103.8  $(1,653.3)   $1,757.1
                                    ======  =========    ========

    Retail vehicle unit sales:
         New                        54,839     62,834      (7,995)      (12.7)
         Used                       34,484     42,457      (7,973)      (18.8)
                                    ------     ------      ------
                                    89,323    105,291     (15,968)      (15.2)
                                    ======    =======     =======

    Revenue per vehicle retailed:
         New                       $29,689    $30,098       $(409)       (1.4)
         Used                      $16,335    $15,263      $1,072         7.0

    Gross profit per vehicle
     retailed:
         New                        $2,183     $1,993        $190         9.5
         Used                       $1,673     $1,566        $107         6.8
         Finance and insurance      $1,071     $1,082        $(11)       (1.0)




          Operating Highlights            Nine Months Ended September 30,
          --------------------       -----------------------------------------
                                     2009       2008    $ Variance  % Variance
                                     ----       ----    ----------  ----------


    Revenue:
      New vehicle                 $4,158.6   $6,039.6   $(1,881.0)      (31.1)
        Retail used vehicle        1,645.7    2,129.4      (483.7)      (22.7)
        Wholesale                    223.8      416.8      (193.0)      (46.3)
                                     -----      -----      ------
      Used vehicle                 1,869.5    2,546.2      (676.7)      (26.6)
                                   -------    -------      ------
      Parts and service            1,616.0    1,765.9      (149.9)       (8.5)
      Finance and insurance, net     261.9      379.6      (117.7)      (31.0)
      Other                           36.8       48.1       (11.3)
                                      ----       ----       -----
    Total revenue                 $7,942.8  $10,779.4   $(2,836.6)      (26.3)
                                  ========  =========   =========


    Gross profit:
      New vehicle                   $279.8     $400.8     $(121.0)      (30.2)
        Retail used vehicle          176.5      221.0       (44.5)      (20.1)
        Wholesale                      5.4       (3.0)        8.4
                                       ---       ----         ---
      Used vehicle                   181.9      218.0       (36.1)      (16.6)
                                     -----      -----       -----
      Parts and service              707.4      769.4       (62.0)       (8.1)
      Finance and insurance          261.9      379.6      (117.7)      (31.0)
      Other                           20.5       26.9        (6.4)
                                      ----       ----        ----
    Total gross profit             1,451.5    1,794.7      (343.2)      (19.1)

    Selling, general and
     administrative expenses       1,099.9    1,338.2       238.3        17.8

    Depreciation and amortization     58.5       64.0         5.5
    Goodwill impairment                  -    1,610.0     1,610.0
    Franchise rights impairment        1.5      127.4       125.9
    Other expenses (income), net     (23.6)       2.9        26.5
                                     -----        ---        ----
      Operating income (loss)        315.2   (1,347.8)    1,663.0

    Floorplan interest expense       (26.7)     (61.1)       34.4
    Other interest expense           (32.5)     (69.3)       36.8
    Gain on senior note
     repurchases                      13.0       12.1         0.9
    Interest income                    0.9        1.5        (0.6)
    Other gains (losses), net          4.0       (2.9)        6.9
                                       ---       ----         ---
      Income (loss) from
       continuing operations before
       income taxes                 $273.9  $(1,467.5)   $1,741.4
                                    ======  =========    ========

    Retail vehicle unit sales:
         New                       136,840    200,574     (63,734)      (31.8)
         Used                      102,774    135,300     (32,526)      (24.0)
                                   -------    -------     -------
                                   239,614    335,874     (96,260)      (28.7)
                                   =======    =======     =======

    Revenue per vehicle retailed:
         New                       $30,390    $30,112        $278         0.9
         Used                      $16,013    $15,738        $275         1.7

    Gross profit per vehicle
     retailed:
         New                        $2,045     $1,998         $47         2.4
         Used                       $1,717     $1,633         $84         5.1
         Finance and insurance      $1,093     $1,130        $(37)       (3.3)




                                    Three Months Ended   Nine Months Ended
       Operating Percentages          September 30,        September 30,
       ---------------------        ------------------   -----------------
                                     2009(%)   2008(%)    2009(%)   2008(%)
                                     ----      ----       ----      ----

    Revenue mix percentages:
      New vehicle                    55.8      56.3       52.4      56.0
      Used vehicle                   22.0      22.9       23.5      23.6
      Parts and service              18.4      17.0       20.3      16.4
      Finance and insurance, net      3.3       3.4        3.3       3.5
      Other                           0.5       0.4        0.5       0.5
                                      ---       ---        ---       ---
                                    100.0     100.0      100.0     100.0
                                    =====     =====      =====     =====

    Gross profit mix percentages:
      New vehicle                    23.2      22.4       19.3      22.3
      Used vehicle                   11.6      11.5       12.5      12.1
      Parts and service              45.4      44.3       48.7      42.9
      Finance and insurance          18.6      20.3       18.0      21.2
      Other                           1.2       1.5        1.5       1.5
                                      ---       ---        ---       ---
                                    100.0     100.0      100.0     100.0
                                    =====     =====      =====     =====

    Operating items as a percentage
     of revenue:
      Gross profit:
         New vehicle                  7.4       6.6        6.7       6.6
         Used vehicle - retail       10.2      10.3       10.7      10.4
         Parts and service           43.5      43.5       43.8      43.6
         Total                       17.7      16.7       18.3      16.6
      Selling, general and
       administrative expenses       13.0      12.6       13.8      12.4
      Operating income (loss)         4.1        NM        4.0        NM

    Operating items as a percentage
     of total gross profit:
      Selling, general and
       administrative expenses       73.8      75.6       75.8      74.6
      Operating income (loss)        23.0        NM       21.7        NM

    NM = Not Meaningful



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

    Segment Operating Highlights      Three Months Ended September 30,
    ---------------------------- -----------------------------------------
                                 2009       2008    $ Variance  % Variance
                                 ----       ----    ----------  ----------


    Revenue:
      Domestic                  $922.4   $1,059.3     $(136.9)      (12.9)
      Import                   1,193.9    1,370.5      (176.6)      (12.9)
      Premium luxury             775.3      900.0      (124.7)      (13.9)
      Corporate and other         24.1       29.5        (5.4)      (18.3)
                                  ----       ----        ----
    Total revenue             $2,915.7   $3,359.3     $(443.6)      (13.2)
                              ========   ========     =======


    *Segment income (loss)
      Domestic                   $33.5      $24.6        $8.9        36.2
      Import                      63.1       51.6        11.5        22.3
      Premium luxury              43.5       42.9         0.6         1.4
      Corporate and other        (29.1)  (1,762.1)    1,733.0
                                 -----   --------     -------
    Total segment income (loss)  111.0   (1,643.0)    1,754.0

    Add: Floorplan
          interest expense         7.6       18.3       (10.7)

                                ------  ---------    --------
    Operating income (loss)     $118.6  $(1,624.7)   $1,743.3
                                ======  =========    ========

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

    Retail new vehicle
     unit sales:
      Domestic                  15,553     17,465      (1,912)      (10.9)
      Import                    30,959     35,067      (4,108)      (11.7)
      Premium luxury             8,327     10,302      (1,975)      (19.2)
                                 -----     ------      ------
                                54,839     62,834      (7,995)      (12.7)
                                ======     ======      ======



    Segment Operating Highlights      Nine Months Ended September 30,
    ---------------------------- -----------------------------------------
                                 2009       2008    $ Variance  % Variance
                                 ----       ----    ----------  ----------

    Revenue:
      Domestic                $2,557.4   $3,509.1     $(951.7)      (27.1)
      Import                   3,091.0    4,332.1    (1,241.1)      (28.6)
      Premium luxury           2,213.3    2,850.8      (637.5)      (22.4)
      Corporate and other         81.1       87.4        (6.3)       (7.2)
                                  ----       ----        ----
    Total revenue             $7,942.8  $10,779.4   $(2,836.6)      (26.3)
                              ========  =========   =========


    *Segment income (loss)
      Domestic                   $80.2      $93.6      $(13.4)      (14.3)
      Import                     134.0      164.0       (30.0)      (18.3)
      Premium luxury             127.3      145.2       (17.9)      (12.3)
      Corporate
       and other                 (53.0)  (1,811.7)    1,758.7
                                 -----   --------     -------
    Total segment income (loss)  288.5   (1,408.9)    1,697.4

    Add: Floorplan
          interest expense        26.7       61.1       (34.4)

                                ------  ---------    --------
    Operating income (loss)     $315.2  $(1,347.8)   $1,663.0
                                ======  =========    ========


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

    Retail new vehicle
     unit sales:
      Domestic                  39,700     58,259     (18,559)      (31.9)
      Import                    74,414    110,703     (36,289)      (32.8)
      Premium luxury            22,726     31,612      (8,886)      (28.1)
                                ------     ------      ------
                               136,840    200,574     (63,734)      (31.8)
                               =======    =======     =======



    Brand Mix - New Vehicle Retail Units Sold
    -----------------------------------------
                                       Three Months Ended   Nine Months Ended
                                         September 30,        September 30,
                                       ------------------   -----------------
                                        2009(%)    2008(%)   2009(%)   2008(%)
                                        ----       ----      ----      ----

      Domestic:
         Ford, Lincoln-Mercury          14.6       12.6      14.6      13.3
         Chevrolet, Pontiac,
          Buick, Cadillac, GMC          11.0       11.8      11.0      12.1
         Chrysler, Jeep, Dodge           2.8        3.4       3.4       3.6
                                         ---        ---       ---       ---
           Domestic total               28.4       27.8      29.0      29.0
                                        ----       ----      ----      ----

      Import:
         Honda                          14.8       14.5      14.8      14.5
         Toyota                         20.8       21.6      20.2      22.1
         Nissan                         14.3       13.7      12.7      12.9
         Other imports                   6.5        6.0       6.7       5.7
                                         ---        ---       ---       ---
           Import total                 56.4       55.8      54.4      55.2
                                        ----       ----      ----      ----

      Premium Luxury:
         Mercedes                        7.3        7.2       7.9       7.0
         BMW                             4.2        5.4       4.5       4.7
         Lexus                           2.3        2.5       2.5       2.8
         Other premium luxury
          (Land Rover, Porsche)          1.4        1.3       1.7       1.3
                                         ---        ---       ---       ---
           Premium Luxury total         15.2       16.4      16.6      15.8
                                        ----       ----      ----      ----

                                       100.0      100.0     100.0     100.0
                                       =====      =====     =====     =====



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


     Capital Expenditures / Stock and    Three Months Ended  Nine Months Ended
      Debt Repurchases                      September 30,      September 30,
     ---------------------------------   ------------------  -----------------
                                             2009    2008       2009   2008
                                             ----    ----       ----   ----

      Capital expenditures                   $6.3  $55.6       $40.5  $96.7
      Acquisitions                             $-     $-        $0.2  $29.4
      Proceeds from exercises of stock
       options                              $13.7     $-       $23.5   $1.0
      Senior note repurchases (aggregate
       principal)                           $10.4  $88.1       $88.4  $88.1
      Stock repurchases:
        Aggregate purchase price            $66.1     $-       $66.1  $54.1
        Shares repurchased (in millions)      3.7      -         3.7    3.8



    Floorplan Assistance        Three Months Ended         Nine Months Ended
     and Expense                  September 30,              September 30,
    --------------------      ---------------------      ---------------------
                              2009   2008  Variance      2009   2008  Variance
                              ----   ----  --------      ----   ----  --------
    Floorplan assistance
     earned (included in
     cost of sales)          $13.8  $16.8    $(3.0)     $34.9  $54.3   $(19.4)
    Floorplan interest
     expense (new vehicles)   (7.1) (17.0)     9.9      (25.2) (58.9)    33.7
                              ----  -----      ---      -----  -----     ----

    Net inventory carrying
     benefit (cost)           $6.7  $(0.2)    $6.9       $9.7  $(4.6)   $14.3
                              ====  =====     ====       ====  =====    =====




    Balance Sheet and Other Highlights
    ----------------------------------

                                     September 30,  December 31, September 30,
                                          2009         2008          2008
                                     ------------- ------------ -------------

    Cash and cash equivalents            $204.5       $110.2         $60.5
    Inventory                          $1,161.1     $1,758.1      $1,826.8
    Total floorplan notes payable      $1,059.9     $1,813.5      $1,773.9
    Non-vehicle debt                   $1,114.4     $1,258.9      $1,413.7
    Equity                             $2,311.3     $2,198.1      $2,127.8
    New days supply (industry
     standard of selling days,
     including fleet)                   47 days      83 days       60 days

    Used days supply (trailing 30 days) 48 days      30 days       41 days



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


    Comparable Basis Reconciliations*
    ---------------------------------
                                              Three Months Ended September 30,
                                            ----------------------------------
                                               Net Income        Diluted
                                                 (Loss)     Earnings Per Share
                                            --------------- ------------------
                                            2009       2008    2009      2008
                                            ----       ----    ----      ----

    As reported                            $65.0  $(1,412.7)  $0.36    $(7.99)

      Discontinued operations, net of
       income taxes                         (0.2)      16.9      $-     $0.10
                                            ----       ----
    From continuing operations,
     as reported                            64.8   (1,395.8)  $0.36    $(7.90)

      Impairment of goodwill and
       franchise rights**                      -    1,447.3      $-     $8.19
      Gain on senior note repurchases          -       (7.4)     $-    $(0.04)
                                             ---       ----

    Adjusted                               $64.8      $44.1   $0.36     $0.25
                                           =====      =====


                                              Nine Months Ended September 30,
                                            ----------------------------------
                                               Net Income        Diluted
                                                 (Loss)     Earnings Per Share
                                            --------------- ------------------
                                            2009       2008    2009      2008
                                            ----       ----    ----      ----

    As reported                           $136.3  $(1,310.2)  $0.76    $(7.35)

      Discontinued operations, net of
       income taxes                         35.5       24.4   $0.20     $0.14
                                            ----       ----
    From continuing operations,
     as reported                           171.8   (1,285.8)  $0.96    $(7.22)


      Net gain on asset sales and
       dispositions                         (9.6)         -  $(0.05)       $-
      Gain on senior note repurchases       (8.1)      (7.3) $(0.05)   $(0.04)
      Property and other
       impairments***                        0.7          -      $-        $-
      Impairment of goodwill and
       franchise rights**                      -    1,447.4      $-     $8.12
      Stock compensation expense
       adjustment                              -        3.2      $-     $0.02
                                             ---        ---


    Adjusted                              $154.8     $157.5   $0.87     $0.88
                                          ======     ======

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

     ** Goodwill and franchise impairments for the three and nine months
        ended September 30, 2008, totaled $1.46 billion after-tax.  Franchise
        impairments of $8.7 million after-tax during the three months ended
        September 30, 2008, and $11.7 million after-tax during the nine months
        ended September 30, 2008, have been reclassified to loss from
        discontinued operations since they related to dealerships classified
        as discontinued operations during 2009.

    *** Property and other impairments for the three months ended March 31,
        2009 totaled $4.8 million after-tax, of which $4.5 million has been
        reclassified to loss from discontinued operations since they related
        to dealerships classified as discontinued operations during 2009.



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


          Operating Highlights           Three Months Ended September 30,
          --------------------       ----------------------------------------
                                     2009      2008    $ Variance  % Variance
                                     ----      ----    ----------  ----------


    Revenue:
      New vehicle                 $1,622.0  $1,877.7     $(255.7)      (13.6)
        Retail used vehicle          560.9     639.0       (78.1)      (12.2)
        Wholesale                     78.3     118.3       (40.0)      (33.8)
                                      ----     -----       -----
      Used vehicle                   639.2     757.3      (118.1)      (15.6)
      Parts and service              536.5     561.6       (25.1)       (4.5)
      Finance and insurance, net      95.5     112.9       (17.4)      (15.4)
      Other                           11.6      14.3        (2.7)
                                      ----      ----        ----
    Total revenue                 $2,904.8  $3,323.8     $(419.0)      (12.6)
                                  ========  ========     =======


    Gross profit:
      New vehicle                   $119.3    $124.4       $(5.1)       (4.1)
        Retail used vehicle           57.5      65.3        (7.8)      (11.9)
        Wholesale                      2.1      (2.2)        4.3
                                       ---      ----         ---
      Used vehicle                    59.6      63.1        (3.5)       (5.5)
      Parts and service              233.4     244.9       (11.5)       (4.7)
      Finance and insurance           95.5     112.9       (17.4)      (15.4)
      Other                            6.1       8.2        (2.1)
                                       ---       ---        ----
    Total gross profit              $513.9    $553.5      $(39.6)       (7.2)
                                    ======    ======      ======


    Retail vehicle unit sales:
         New                        54,732    62,434      (7,702)      (12.3)
         Used                       34,397    41,788      (7,391)      (17.7)
                                    ------    ------      ------
                                    89,129   104,222     (15,093)      (14.5)
                                    ======   =======     =======

    Revenue per vehicle retailed:
         New                       $29,635   $30,075       $(440)       (1.5)
         Used                      $16,307   $15,291      $1,016         6.6

    Gross profit per vehicle
     retailed:
         New                        $2,180    $1,993        $187         9.4
         Used                       $1,672    $1,563        $109         7.0
         Finance and insurance      $1,071    $1,083        $(12)       (1.1)



          Operating Highlights            Nine Months Ended September 30,
          --------------------       ----------------------------------------
                                     2009      2008    $ Variance  % Variance
                                     ----      ----    ----------  ----------


    Revenue:
      New vehicle                 $4,124.5  $5,996.1   $(1,871.6)      (31.2)
        Retail used vehicle        1,629.7   2,099.6      (469.9)      (22.4)
        Wholesale                    219.8     409.9      (190.1)      (46.4)
                                     -----     -----      ------
      Used vehicle                 1,849.5   2,509.5      (660.0)      (26.3)
      Parts and service            1,605.3   1,737.1      (131.8)       (7.6)
      Finance and insurance, net     260.4     376.3      (115.9)      (30.8)
      Other                           34.9      46.2       (11.3)
                                      ----      ----       -----
    Total revenue                 $7,874.6 $10,665.2   $(2,790.6)      (26.2)
                                  ======== =========   =========


    Gross profit:
      New vehicle                   $278.0    $398.4     $(120.4)      (30.2)
        Retail used vehicle          174.3     217.3       (43.0)      (19.8)
        Wholesale                      5.6      (2.9)        8.5
                                       ---      ----         ---
      Used vehicle                   179.9     214.4       (34.5)      (16.1)
      Parts and service              702.9     759.7       (56.8)       (7.5)
      Finance and insurance          260.4     376.3      (115.9)      (30.8)
      Other                           19.9      26.4        (6.5)
                                      ----      ----        ----
    Total gross profit            $1,441.1  $1,775.2     $(334.1)      (18.8)
                                  ========  ========     =======


    Retail vehicle unit sales:
         New                       136,103   199,259     (63,156)      (31.7)
         Used                      101,894   133,167     (31,273)      (23.5)
                                   -------   -------     -------
                                   237,997   332,426     (94,429)      (28.4)
                                   =======   =======     =======

    Revenue per vehicle retailed:
         New                       $30,304   $30,092        $212         0.7
         Used                      $15,994   $15,767        $227         1.4

    Gross profit per vehicle
     retailed:
         New                        $2,043    $1,999         $44         2.2
         Used                       $1,711    $1,632         $79         4.8
         Finance and insurance      $1,094    $1,132        $(38)       (3.4)



                                     Three Months Ended     Nine Months Ended
         Operating Percentages          September 30,         September 30,
         ---------------------       ------------------     -----------------
                                      2009(%)   2008(%)     2009(%)   2008(%)
                                      ----      ----        ----      ----
    Revenue mix percentages:
      New vehicle                     55.8      56.5        52.4      56.2
      Used vehicle                    22.0      22.8        23.5      23.5
      Parts and service               18.5      16.9        20.4      16.3
      Finance and insurance, net       3.3       3.4         3.3       3.5
      Other                            0.4       0.4         0.4       0.5
                                       ---       ---         ---       ---
                                     100.0     100.0       100.0     100.0
                                     =====     =====       =====     =====

    Gross profit mix percentages:
      New vehicle                     23.2      22.5        19.3      22.4
      Used vehicle                    11.6      11.4        12.5      12.1
      Parts and service               45.4      44.2        48.8      42.8
      Finance and insurance           18.6      20.4        18.1      21.2
      Other                            1.2       1.5         1.3       1.5
                                       ---       ---         ---       ---
                                     100.0     100.0       100.0     100.0
                                     =====     =====       =====     =====

    Operating items as a
     percentage of revenue:
      Gross Profit:
         New vehicle                   7.4       6.6         6.7       6.6
         Used vehicle - retail        10.3      10.2        10.7      10.3
         Parts and service            43.5      43.6        43.8      43.7
         Total                        17.7      16.7        18.3      16.6



                                   AUTONATION, INC.
                 KEY CREDIT AGREEMENT COVENANT COMPLIANCE CALCULATIONS
                                 September 30, 2009
                 -----------------------------------------------------

    ($ millions)

    -------------------------------------------------------
    Income Statement information for the last twelve months
     (October 1, 2008 - September 30, 2009):
    -------------------------------------------------------

    Net income (loss) from continuing operations                    $248.4

    Floorplan and other interest expense                              99.3

    Income tax provision (benefit)                                    91.6

    Depreciation and amortization                                     79.5

    Stock-based compensation expense (SFAS No. 123R)                  14.5

    Impairment charges (including goodwill, franchise rights,
     and long-lived assets)                                            5.3
                                                                       ---

    EBITDA                                                           538.6

    Floorplan interest expense                                       (46.7)
                                                                     -----

    Adjusted EBITDA                                                 $491.9
                                                                    ======
    -------------------------
    As of September 30, 2009:
    -------------------------

    Funded indebtedness (primarily comprised of current and long-
     term debt and letters of credit)                             $1,186.4

    Vehicle secured indebtedness (floorplan payables)              1,059.9
                                                                   -------

    Funded indebtedness including floorplan                        2,246.3

    Shareholders' equity                                           2,311.5
                                                                   -------

    Total capitalization including floorplan                      $4,557.8
                                                                  ========

    ----------------------------------------------------------------------
    Ratio of funded indebtedness/
    Adjusted EBITDA....................................               2.41
    Covenant...........................................   less than   3.00
    ----------------------------------------------------------------------

    ----------------------------------------------------------------------
    Ratio of funded indebtedness including floorplan/
    Total capitalization including floorplan...........               49.3%
    Covenant...........................................   less than   65.0%
    ----------------------------------------------------------------------

SOURCE AutoNation, Inc.

Marc Cannon, +1-954-769-3146, Cannonm@autonation.com; or Investors: Derek Fiebig, +1-954-769-7342, fiebigd@autonation.com

Media Contact

Marc Cannon
Executive Vice President
Chief Marketing Officer, Communications and Public Policy
Phone: 954.769.3146
cannonm@autonation.com

Press inquiries, or interview requests can be sent to Marc via e-mail.

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