U.S. SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

                                    Form 10-Q

[X]      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934
         For the quarterly period ended      March 31, 1998
                                         --------------------------

                                       OR

[  ]     TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
         SECURITIES EXCHANGE ACT OF 1934
         For the transition period from _____________  to ___________________

         Commission file number    1-14082
                                   --------

                       SMART CHOICE AUTOMOTIVE GROUP, INC.
             (Exact name of registrant as specified in its charter)


                FLORIDA                            59-1469577
      (State or other jurisdiction of       (I.R.S. Employer Identification No.)
       incorporation or organization)

              5200 S. Washington Avenue, Titusville, Florida 32780
                    (Address of principal executive offices)
                                   (Zip Code)

                                 (407) 269-9680
              (Registrant's telephone number, including area code)

                              _____________________
              (Former name, former address and former fiscal year,
                         if changed since last report)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  report(s),  and (2) has  been  subject  to such  filing
requirements for the past 90 days.

Yes    X__    No ______

     Indicate  number or shares  outstanding of each of the issuer's  classes of
common stock, as of the latest practicable date:

     As of May 12, 1998, 12,743,580 shares of the Registrant's Common Stock were
issued and outstanding.


<PAGE>



                       SMART CHOICE AUTOMOTIVE GROUP, INC.

                                    Form 10-Q

                                TABLE OF CONTENTS
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                                                                                               PAGE
<S>                                                                                              <C>
PART I  -  FINANCIAL STATEMENTS

         Item 1.  Financial Statements.                                                          2

                  Condensed Consolidated Balance sheets       -                                  3
                  March 31, 1998 and December 31, 1997

                  Condensed Consolidated Statements of Operations  -                             5
                  Three Months Ended March 31, 1998 and March 31, 1997

                  Condensed Consolidated Statements of Cash Flow  -                              6
                  Three Months ended March 31, 1998 and March 31, 1997

                  Notes to Condensed Consolidated Financial Statements                           8

         Item 2.  Management's Discussion and Analysis of Financial Condition and                9
                  Results of Operations                                                         

Part II  OTHER INFORMATION                                                                       15

         Item 2.  Changes in Securities                                                          15

         Item 6.  Exhibits and Reports on Form 8-K                                               16

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                                     PART I

                      SMART CHOICE AUTOMOTIVE GROUP, INC.

                              FINANCIAL STATEMENTS

         Item 1.  Financial Statements.

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                                                                                     SMART CHOICE AUTOMOTIVE GROUP, INC.
                                                                                   Condensed Consolidated Balance Sheets

--------------------------------------------------------------------------------------------------------------------------

                                                                  As of March 31, 1998     As of December 31, 1997
-------------------------------------------------------------------------------------------------------------------------
<S>                                                                  <C>                            <C>
                                                                      (Unaudited)                   (Audited)
 Assets
   Cash and cash equivalents                                      $     2,394,391              $   1,066,949
   Accounts receivable                                                  3,164,705                  1,773,124
   Finance receivables
     Principal balances, net                                           51,146,019                 39,109,368
     Less: allowance for credit losses                                 (8,493,306)                (6,857,265)
-------------------------------------------------------------------------------------------------------------------------
                                                                       42,652,713                 32,252,103
   Inventories, at cost                                                17,429,409                 15,516,084
   Land held for resale                                                 1,064,205                  1,050,000
   Property and equipment, net                                          9,126,667                  9,214,207
   Notes receivable                                                        23,140                     46,280
   Deferred tax asset                                                       1,000                         --
   Dferred debt costs                                                    949,330                    426,823
   Goodwill                                                            25,401,022                 25,562,162
   Prepaid expenses                                                     1,530,471                  1,008,229
   Deposits                                                               178,237                    170,305
   Other assets                                                           977,477                     43,681
  -------------------------------------------------------------------------------------------------------------------------

                                                                  $   104,892,766             $   89,104,991
  -----------------------------------------------------------------------------------------------------------------------
                       See accompanying notes to condensed consolidated financial statements

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                                                                        SMART CHOICE AUTOMOTIVE GROUP, INC.
                                                                      Condensed Consolidated Balance Sheets

------------------------------------------------------------------------------------------------------------

                                                           As of March 31, 1998    As of  December 31, 1997
------------------------------------------------------------------------------------------------------------
<S>                                                                 <C>                        <C>
                                                                    (Unaudited)           (Audited)
 Liabilities and Stockholders' Equity
   Liabilities:
     Accounts payable                                        $       6,793,434       $    5,259,903
     Accrued expenses                                                4,152,209            4,633,841
     Deferred income                                                    92,861                   --
     Floorplan payable                                               9,413,944            8,287,092
     Capital lease obligations                                         869,268              940,280
     Notes payable                                                  71,720,664           60,427,058
     Deferred income taxes                                               2,042                   --
     Convertible debt                                                  340,000                   --
     Other liabilities                                                      --               94,913
----------------------------------------------------------------------------------------------------
   Total liabilities                                                93,384,422           79,643,087
----------------------------------------------------------------------------------------------------

     Redeemable convertible preferred
       stock                                                         1,491,834            4,941,834           

   Stockholders' equity:
     Common stock                                                      122,595               97,340
     Additional paid in capital                                     27,913,049           24,108,456
     Accumulated deficit                                           (18,019,934)         (19,685,726)
                                           
-----------------------------------------------------------------------------------------------------
   Total stockholders' equity                                       10,016,510             4,520,070
-----------------------------------------------------------------------------------------------------

                                                              $    104,892,766       $    89,104,991
----------------------------------------------------------------------------------------------------
                       See accompanying notes to condensed consolidated financial statements


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                                                                          SMART CHOICE AUTOMOTIVE GROUP, INC.
                                                              Condensed Consolidated Statements of Operations
                                                                                                  (Unaudited)

--------------------------------------------------------------------------------------------------------------
                                                               Three Months Ended          Three Months Ended
                                                                   March 31, 1998              March 31, 1997
--------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>                               <C>
 Vehicle and Related Revenues:
    Sales of new vehicles                                              $8,123,424                          --
    Sales of used vehicles                                             21,845,559                   4,785,077
    Income on finance receivables                                       4,146,215                     522,939
    Income from insurance and training                                    180,222                     262,280
    Income from parts and accessories                                   4,364,037                   2,498,753
--------------------------------------------------------------------------------------------------------------
                                                                       38,659,457                   8,069,049
--------------------------------------------------------------------------------------------------------------

 Cost of Vehicle and Vehicle Related Revenues:
    Cost of new vehicles sold                                           7,187,085                          --
    Cost of used vehicles sold                                         15,088,274                   3,390,292
    Provision for credit losses                                         2,904,128                   1,049,680
    Cost of insurance and training                                         30,757                      13,565
    Cost of parts and accessories sold                                  2,796,891                   1,561,922
--------------------------------------------------------------------------------------------------------------
                                                                       28,007,135                   6,015,459
--------------------------------------------------------------------------------------------------------------
 Net revenues from vehicle sales and vehicle
    related activities                                                 10,652,322                   2,053,590
--------------------------------------------------------------------------------------------------------------
 Expenses:
   Operating expenses                                                   7,979,811                   5,081,660
   Compensation expense related to employee stock options                     --                    3,125,877                       
--------------------------------------------------------------------------------------------------------------
                                                                        7,979,811                   8,207,537
--------------------------------------------------------------------------------------------------------------
 Income (loss) from operations                                          2,672,511                  (6,153,947)
---------------------------------------------------------------------------------------------------------------
 Other expense (income):
    Interest expense                                                    1,909,671                     692,617
    Other income                                                         (919,413)                     (9,173)
    Miscellaneous expense                                                  15,661                      64,944
--------------------------------------------------------------------------------------------------------------
                                                                          510,705                     748,388
--------------------------------------------------------------------------------------------------------------
Net income (loss)                                                  $    1,666,592              $   (6,902,335)
--------------------------------------------------------------------------------------------------------------
Preferred Stock dividends                                          $       77,875                          --
Net income available to common stock holders                       $    1,588,717              $   (6,902,335) 
--------------------------------------------------------------------------------------------------------------
Net income (loss) per share
--------------------------------------------------------------------------------------------------------------
  -  Primary                                                       $        0 .15              $        (0.87)
--------------------------------------------------------------------------------------------------------------
  -  Fully diluted                                                           0.14
--------------------------------------------------------------------------------------------------------------
Weighted Average Number of Shares
    and Share Equivalents Outstanding:
  -  Primary                                                           10,380,260                   7,853,134
  -  Fully diluted                                                     11,226,758

                       See accompanying notes to condensed consolidated financial statements
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                                                                                      SMART CHOICE AUTOMOTIVE GROUP, INC.
                                                                          Condensed Consolidated Statements of Cash Flows
                                                                                                              (Unaudited)

--------------------------------------------------------------------------------------------------------------------------
                                                                               Three Months Ended      Three Months Ended
                                                                                   March 31, 1998          March 31, 1997
--------------------------------------------------------------------------------------------------------------------------
<S>                                                                                      <C>                  <C>

 Cash flows from operating activities:
   Net income/ (loss)                                                                $  1,666,592          $   (6,902,335)
   Adjustments to reconcile net loss to
     net cash provided by operating activities:
      Provision for credit losses                                                       2,904,128                 681,435
      Common stock and options issued for consulting fees                                      --                 150,000
      Loss on disposal of fixed assets                                                         --                   1,151
      Stock option compensation                                                                --               3,125,877
      Depreciation and amortization                                                       634,995                 245,530
      Recoupment of expenses                                                             (165,967)                    --
      Cash provided by (used for):
         Accounts receivable                                                           (2,513,545)                (70,894)
         Inventory                                                                     (1,913,325)               (422,499)
         Prepaid expenses                                                                (522,242)                (18,974)
         Other assets                                                                          --                  (1,453)
         Accounts payable                                                               1,537,063                 964,984
         Accrued expenses                                                                (481,632)                950,891
         Deferred income                                                                   (1,010)                 20,772
         Other liabilities                                                                     --               1,657,444
         Customer deposits                                                                     --                (116,099)
         Floorplan payable                                                              1,126,852                 224,876
---------------------------------------------------------------------------------------------------------------------------
 Net cash provided by operating activities                                              2,271,909                 470,706
----------------------------------------------------------------------------------------------------------------------------

Cash flows from investing activities:
    Increase in finance receivables                                                   (12,329,624)            (1,153,486)
    Cash for acquisitions, net of cash acquired                                                --             (2,797,310)
    Issuance of notes receivable                                                               --               (565,896)
    Increase in deposits                                                                   (7,932)              (477,300)
    Increase in other assets                                                              (41,210)                    --
    Increase in deferred acquisition costs                                                     --                (15,400)
    Payment of notes receivable                                                           23, 140                     --
    Purchase of property and equipment                                                   (181,034)               (56,379)
    Decrease in other assets                                                                   --                 40,435
    Purchase of land                                                                      (14,205)                    --
---------------------------------------------------------------------------------------------------------------------------
 Net cash used in investing activities                                                (12,550,935)           (5,025,336)
---------------------------------------------------------------------------------------------------------------------------

                                              Continued on next page

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                                                                                       SMART CHOICE AUTOMOTIVE GROUP, INC.
                                                                           Condensed Consolidated Statements of Cash Flows
                                                                                                               (Unaudited)
                                                                                                               (Continued)

---------------------------------------------------------------------------------------------------------------------------
                                                                              Three Months Ended        Three Months Ended
                                                                                  March 31, 1998            March 31, 1997
---------------------------------------------------------------------------------------------------------------------------
<S>                                                                                      <C>                          <C>
 Cash flows from financing activities:
    Principal payments on notes payable                                             $   (874,242)            $  (1,835,310)
    Proceeds from issuance of Sirrom debt                                                     --                 3,500,000
    Proceeds from issuance of notes payable                                            3,000,000                 3,996,722
    Increase in deferred debt costs                                                           --                  (256,494)
    Increase (decrease) in senior secured debt  payable                                9,500,000                        --
    Proceeds from issuance of preferred stock                                                 --                   590,000
    Proceeds from issuance of convertible debentures                                          --                   300,000
    Bank overdraft                                                                            --                   (82,884)
    Payments on capital lease obligations                                                (19,289)                      --
---------------------------------------------------------------------------------------------------------------------------
Net cash provided by financing activities                                             11,606,469                 6,212,034
---------------------------------------------------------------------------------------------------------------------------
 Net increase / (decrease) in cash and cash equivalents                                1,327,438                 1,657,404

 Cash and cash equivalents at beginning of period                                      1,066,949                         0
---------------------------------------------------------------------------------------------------------------------------
 Cash and cash equivalents at end of period                                         $  2,394,391               $ 1,657,404
---------------------------------------------------------------------------------------------------------------------------
                       See accompanying notes to condensed consolidated financial statements

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                                             SMART CHOICE AUTOMOTIVE GROUP, INC.
                           Notes to Condensed Consolidated  Financial Statements
                                                                     (Unaudited)

===============================================================================

Note 1  -  Basis of Presentation

The accompanying  unaudited condensed consolidated financial statements of Smart
Choice  Automotive  Group, Inc. (the "Company") have been prepared in accordance
with generally accepted accounting principles for interim financial information.
Accordingly,  they do not include all of the information and footnotes  required
by generally accepted  accounting  principles for a complete financial statement
presentation.  In the opinion of management,  such unaudited interim information
reflect  all  adjustments,  consisting  only of  normal  recurring  adjustments,
necessary to present the Company's  financial position and results of operations
for the periods presented. The results of operations for interim periods are not
necessarily indicative of the results to be expected for a full fiscal year. The
Condensed  Consolidated  Balance  Sheet as of December 31, 1997 was derived from
audited  consolidated  financial statements as of that date but does not include
all  the  information  and  notes  required  by  generally  accepted  accounting
principles.   It  is  suggested  that  these  condensed  consolidated  financial
statements  be read in  conjunction  with  the  company's  audited  consolidated
financial  statements  included in the Company's  Annual Report on Form 10-K for
the year ended December 31, 1997.

Note 2 - Finance Receivables

     The  Company's  finance  receivables  ("Finance  Receivables"  or  "Finance
Contracts") are automobile retail  installment sale contracts  originated by the
Company on sales of used cars at its automobile dealerships. The following shows
the principal  balances of the  Company's  Finance  Receivables  as of March 31,
1998:

                                                        March 31, 1998
                                                        --------------

         Contractually scheduled payments               $50,439,275
         Less: allowance for credit losses               (8,493,306)
                                                         ---------- 
         Principal balances, net                        $41,945,969
                                                        ===========


Note 3 - Presentation of Dealership Revenues and Cost of Revenues

Revenues from Company dealership  operations consist of Sales of New Cars, Sales
of Used  Cars,  Income  on  Finance  Receiveables,  Income  from  Insurance  and
Training,  and Income from Parts and Accessories.  Cost of Revenues include cost
of New Cars Sold, Cost of Used Cars Sold, the Provision for Credit Losses, Costs
of Insurance and Training Income and Cost of Parts and Accessories Sold.

The prices at which the  Company  sells its cars and the  interest  rate that it
charges  to  finance  these  sales take into  consideration  that the  Company's
primary customers are high-risk borrowers,  some of whom ultimately default. The
Provision for Credit Losses reflects these factors and is treated by the Company
as a cost of both the future finance  income derived on the finance  receivables
originated  at  Company  dealerships  as well as a cost of the sales of the cars
themselves.

Note 4 - Common Stock Equivalents

Net earnings per common share amounts are based on the weighted  average  number
of common  shares and common  stock  equivalents  outstanding  as  reflected  on
Exhibit 11 to this Quarterly Report on Form 10-Q.

Item No.  2.   Management's Discussion and Analysis of Financial Condition 
               and Results of Operations.

     The  following  discussion  and  analysis  of  the  Company's  consolidated
financial  position and  consolidated  results of  operations  should be read in
conjunction with the Company's condensed  consolidated  financial statements and
related notes thereto included in Item 1.

Forward Looking Statements

     This report contains forward looking statements. Additional written or oral
forward  looking  statements  may be made by the  Company  from  time to time in
filings with the Securities and Exchange  Commission or otherwise.  Such forward
looking  statements  are  within the  meaning of the term in Section  27A of the
Securities Act of 1933, as amended,  and Section 21E of the Securities  Exchange
Act of 1934, as amended.  Such  statements  may include,  but not be limited to,
projections of revenues,  income,  or loss,  estimates of capital  expenditures,
plans for future operations, products or services, and financing needs or plans,
as well as assumptions relating to the foregoing. The words "believe," "expect,"
"anticipate,"  "estimate,"  "project," and similar expressions  identify forward
looking  statements,  which  speak only as of the date the  statement  was made.
Forward looking  statements are inherently  subject to risks and  uncertainties,
some of which  cannot be  predicted  or  quantified.  Future  events  and actual
results could differ  materially  from those set forth in,  contemplated  by, or
underlying the forward looking statements.  The Company undertakes no obligation
to publicly update or revise any forward looking statements, whether as a result
of new information,  future events, or otherwise. The following disclosures,  as
well as other  statements  in this Report on Form 10-Q,  and in the notes to the
Company's condensed consolidated  financial statements,  describe factors, among
others, that could contribute to or cause such differences, or that could affect
the Company's stock price.

Introduction

     The Eckler  Merger.  In  January  1997,  the  Company,  then  named  Eckler
Industries, Inc., which had completed an initial public offering in 1995 and had
been  exclusively in the Corvette parts and  accessories  business,  merged (the
"Eckler Merger") with Smart Choice Holdings, Inc. ("SCHI"),  which was acquiring
various automobile sales and finance companies.  In the Eckler Merger,  SCHI was
the surviving  corporation of a merger with an acquisition  subsidiary of Eckler
Industries,  Inc.,  and SCHI is  presently  a  wholly  owned  subsidiary  of the
Company. After the Eckler Merger, the Company's name was changed to Smart Choice
Automotive Group, Inc.

     In the Eckler Merger shareholders of SCHI were issued Common Stock having a
majority of the voting rights of the Company.  Therefore,  the Eckler Merger was
accounted  for as a  purchase  of Eckler  Industries,  Inc.  by SCHI (a  reverse
acquisition in which SCHI is considered  the acquirer for accounting  purposes).
Accordingly,  the  financial  statements of the Company for the periods prior to
January 28, 1997 are those of SCHI, which was incorporated on June 21, 1996, and
was a development stage company prior to the Eckler Merger.

     Comparability.  From the date of the  Eckler  Merger  and  thereafter,  the
Company acquired various  automobile  sales and finance  companies.  The Company
recorded the  acquisition  of each of these  companies as  purchases,  and their
assets  were  recorded  at their  estimated  fair  values  and their  results of
operations have been included in the  consolidated  financial  statements of the
Company since their respective dates of acquisition. Thus, the Company's results
of  operations  for the three  months  ended  March 31,  1997 do not include the
results of  operations  for the  companies  acquired on or about the date of the
Eckler Merger for the entire period.  In addition,  the Company acquired various
other  businesses  in 1997,  the results of operations of which are reflected in
the  results of  operations  for the first  quarter of 1998 but not those of the
first quarter of 1997.  This factor should be taken into account when  comparing
the  March 31,  1998  financial  statements  to the  March  31,  1997  financial
statements.

     Presentation of Dealership  Revenues and Costs and Expenses.  Revenues from
new car dealerships include sales of new and used vehicles,  as well as revenues
from  repairs and  finance and  insurance  commissions.  Revenues  from used car
dealership  operations  consist  of sales of used  cars and  income  on  Finance
Receivables.  Costs and expenses of used and new car  dealership  operations  is
comprised of the cost of vehicles and other  products sold and the provision for
credit losses on Finance Receivables.  The prices at which the Company sells its
used cars at its used car  dealerships  and the interest rate that it charges to
finance these sales take into consideration that the Company's primary customers
are high-risk borrowers.  The provision for credit losses reflects these factors
and is  treated  by the  Company  as a cost of both the  future  finance  income
derived on the  Finance  Contracts  originated  at the  Company's  First  Choice
dealerships,  as  well as the  cost of the  sales  of the  vehicles  themselves.
Accordingly,  unlike  traditional car dealerships,  the Company does not present
gross profits in the  Statement of  Operations  calculated as sales of used cars
less cost of used cars sold.

     Operational Changes.  Management undertook a comprehensive restructuring of
the Company beginning in late 1997 with the expectation of better meeting future
operational and liquidity needs.  Some of the results of that  restructuring are
reflected  in the three  months ended March 31,  1998.  Some  components  of the
restructuring include the following:

     Management determined to emphasize used car operations,  which tend to have
     higher  gross  margins  than new car sales.  Acquisition  plans for new car
     dealerships were curtailed in early December 1997. Management  concentrated
     on achieving  operational  efficiencies at the 22 used car dealerships that
     the Company had acquired or opened during 1997.

     Management took one-time  charges in the fourth quarter of 1997 relating to
     acquisition expenses and severance payments.

     Staff was reduced by 15% in November and December of 1997.

     Overhead  expenses  were reduced over $2 million  during late  November and
     December, 1997 and January, 1998.

     A new  Chief  Financial  Officer  was  retained  in  September,  a new Vice
     President of Finance was employed in November, and a significant portion of
     the accounting staff was replaced.

     A Company-wide budget was prepared and implemented.

     "Flash  reports"  were  developed  for the  Company's  divisions  beginning
     January  15,  1998.  These  flash  reports  are  used to  monitor  business
     operations and results on a regular basis.

     In  late  1997,  the  Company  completed  a  "static  pool"  analysis  that
     established  a  benchmark  for  analysis  of the  quality of the  Company's
     Finance  Receivable  portfolio.  The static pool  indicated that the actual
     losses (12 %) on the portfolio were substantially less than loss reserves (
     17 %).

     The  Company's  finance  subsidiary  expanded  its loan  portfolio to $72.2
     million while  establishing  and maintaining  underwriting  procedures that
     have resulted in 93.7% of the Finance  Contracts  being current (30 days or
     fewer past due).

     Eckler  Industries,  Inc.  ("Eckler") was  restructured to focus on greater
     customer service. Inventory carrying costs were reduced by negotiating with
     vendors. "Drop ship" delivery is being utilized. As the mail order business
     constitutes  over 93%  Eckler's  revenue,  two mail order  catalogs are now
     used, instead of one per year as in the past.

     Management also undertook a restructuring  of debt obligations in late 1997
     and the  first  quarter  of 1998 in order to  better  meet its  foreseeable
     liquidity needs. The debt  restructuring  included expanded  financings for
     key areas of the business as well as  negotiating  conversions of some debt
     instruments  into equity and  refinancing  obligations  with  maturities in
     1998. See "Liquidity and Capital Resources."

Results of Operations

     Revenues.  The Company  experienced nearly a four-fold increase in revenues
for the three months  ended March 31, 1998  compared to the same period in 1997.
The 1997 revenues  reflect less than two months of combined  operations  for the
companies that merged in later January and February, 1997. In contrast, the 1998
revenues  reflect a full  quarter  of  operations  which  included  those of the
companies  acquired  later  in 1997  and  the  opening  of new  used  car  sales
locations.

     Costs and Expenses.  Cost of revenues also increased  nearly  four-fold for
the quarter  ended March 31, 1998  compared to the 1997 period,  reflecting  the
increased sales  discussed  above.  Cost of revenues,  as a percent of revenues,
decreased from approximately  74.5% for the three months ended March 31, 1997 to
approximately  72.4%  of  revenues  for the  same  period  in  1998.  The  lower
percentage cost of sales reflects  management's  increased focus on loan quality
and higher  margins for car sales in the 1998  period.  In the first  quarter of
1997,  substantial  amounts of  management  time were  allocated  to  analyzing,
negotiating,  and  assimilating  acquisitions.  The improved margins in the 1998
period  reflected  implementation  of policies and  procedures  for the acquired
companies.

     Operating Expenses.  Operating expenses consist of selling,  marketing, and
general  and  administrative   expenses,   and  depreciation  and  amortization.
Operating  expenses decreased from $8.2 million for the three months ended March
31, 1996 to $8.0  million for the same period in 1997.  The first  quarter  1997
operating expenses included  approximately $3.1 million in expense recognized by
the  Company  from  issuing  stock  options to key  management  personnel  by an
affiliated  trust.  Additionally,  in the first  quarter  of 1997,  the  Company
recognized  expense of approximately  $1.7 million to settle various  consulting
agreements and employment contracts of predecessor companies.  Without those two
items,  the  Company's  operating  expenses for the three months ended March 31,
1997 would have totaled  $3.4  million,  or 42.3% of revenues,  compared to $8.0
million,  or 20.6% of revenues in the same period in 1998.  Management  believes
that the decreased  percentage of costs to revenues reflects  economies of scale
and the better utilization of the Company's infrastructure including centralized
marketing, accounting, and management information functions.

     Allowance  for  Credit  Losses.   The  allowance  for  credit  losses  (the
"Allowance")  was 16.8% of the principal of Finance  Receivables as of March 31,
1998.  The  following  table  reflects  activity  in the  Allowance,  as well as
information  regarding  charge off activity,  on Finance  Receivables  for three
months ended March 31, 1998.

                                            Three Months Ended
                                             March 31, 1998
                                             -----------------
Allowance Activity:                             (In thousands)
-------------------                             

Balance, beginning of period..........              $ 6,857
Provision for credit losses...........                2,904
  Net charge offs.....................               (1,268)
                                                     ------ 
Balance, end of period................              $ 8,493
                                                    =======

Charge Off Activity:
--------------------

Principal balances:
  Collateral repossessed..............              $(2,536)
Recoveries, net.......................                1,268
                                                      -----
  Net charge offs.....................              $(1,268)
                                                    ======= 

     Analysis of the portfolio  delinquencies  is  considered in evaluating  the
adequacy of the Allowance.  The following table reflects the principal  balances
of current and  delinquent  Finance  Receivables  as a  percentage  of the total
outstanding Finance Receivable principal balance as of March 31, 1998 and 1997.

                                                               March 31,
                                                               ---------
         Aging Percentages:                                1998        1997
                                                           ----        ----
         Principal balances current....................    93.7%      88.7%
         Principal balances 31 to 60 days..............     2.8%       6.3%
         Principal balances over 60 days...............     3.5%       5.0%


     Management  believes that the decrease in the percentage of loans which are
not delinquent reflects the Company's focus on higher quality borrowers in 1998,
its financing only cars sold at its  dealerships  rather than  purchasing  loans
from other dealers, and increased collection efforts.

     Interest  Expense.  Interest  expense  totaled  $1.9  million for the three
months  ended  March 31, 1998  compared  to $0.7  million for the same period in
1997, an increase of 176%. The increase resulted primarily from interest on debt
attributable  to  acquisitions  and  interest  on  financing  increased  Finance
Receivables and inventory as the Company expanded its operations.

     Other Income.  Other income  totaled  approximately  $919,000 for the three
months ended March 31, 1998 compared to $9,000 for the same period in 1997.  The
1998 amount is  comprised  primarily  of sales tax refunds on  repossessed  cars
($350,000),  late fees on delinquent loans  ($167,000),  and recoupment of prior
year expenses ($165,000).

Liquidity and Capital Resources

     The following table sets forth the major  components of the increase in the
cash and cash  equivalents,  in thousands,  for the periods ended March 31, 1998
and 1997:

                                                            March 31,
                                                            ---------
                                                       1998           1997
                                                       ----           ----

Net cash provided (used) by operating activities    $  2,272         $    470
Net cash used by investing activities                (12,551)          (5,025)
Net cash provided by financing activities             11,606            6,212
                                                      ------          -------
Net increase in cash and cash equivalents           $   1,327        $  1,657
                                                    =========        ========

     The Company requires capital to support  increases in Finance  Receivables,
vehicle inventory, parts and accessories inventory,  property and equipment, and
working capital for general corporate purposes. Funding sources available to the
Company  include   operating  cash  flow,  third  party   investors,   financial
institution  borrowings and borrowings against finance receivables.  The Company
intends to explore selling (securitizing) its Finance Receivables in the future.

     Net cash flows provided by operating  activities  were  approximately  $2.3
million and $0.5  million for the three month  periods  ended March 31, 1998 and
1997,  respectively.  Net cash provided from  operating  activities in the first
quarter of 1998 primarily reflects the net income for the period and an increase
in payables.  The increase in the first  quarter of 1997  reflected the non-cash
stock option  compensation which was included as an expense in that period, plus
increases in accounts  payable,  accrued  expenses,  other  liabilities  and the
provision for credit losses.

     Cash used  investing  activities was  approximately  $12.6 million and $5.0
million  during  the  three  month  periods  ended  March  31,  1998  and  1997,
respectively.   The  1998  amount  primarily   reflects   increases  in  Finance
Receivables  carried by the  Company.  The 1997  amount  reflects an increase in
Finance Receivables and debt associated with the acquisition of companies during
the first quarter of 1997.

     Cash provided by financing  activities was approximately  $11.6 million and
$6.2 million during 1998 and 1997,  respectively.  In the first quarter of 1998,
the Company  increased its notes payable on finance  receivables by $9.5 million
and borrowed $3 million.

     In the first quarter of 1997, the Company raised approximately $0.6 million
through  the sale of  Preferred  Stock,  and  increased  its line of credit  and
floorplan borrowings by approximately $5.8 million.


     Revolving Credit Facilities.  The Company's  revolving credit facility with
Finova  Capital  Corporation  (the "Finova  Revolving  Facility")  had a maximum
commitment of $35 million at December 31, 1997. The credit line was increased to
a  maximum  commitment  of $42.5  million  on March  27,  1998 and $75  million,
effective May 11, 1998.  Under the Finova  Revolving  Facility,  the Company may
borrow up to 55% of the gross balance of eligible Finance Contracts.  The Finova
Revolving  Facility  expires in December 2001, at which time its renewal will be
subject  to  renegotiation.   The  Finova  Revolving   Facility  is  secured  by
substantially all of the Company's Finance Receivables.  As of December 31, 1997
and March 31, 1998, the principal amount  outstanding under the Finova Revolving
Facility was $31.4 million and $40.9 million, respectively. The Finova Revolving
Facility  bears  interest at the prime rate  (currently  the Citibank N.A. prime
rate) plus 2.5%.

     In 1997 and the first  quarter of 1998 the  Company  financed  its used car
inventory through a line of credit with Manheim Automotive  Financial  Services,
Inc. (the "Manheim  Facility") which had an outstanding  balance at December 31,
1997 of $2.7 million and $3.5 million at March 31, 1998. The maximum  commitment
on the Manheim Facility is $3.75 million. The Manheim Facility is secured by the
Company's buy here-pay  here used car inventory and bears  interest at 1.5% over
the prime rate. The Company is  negotiating  with other lenders for an increased
credit line.

     The Company finances its new car inventory through  manufacturer  floorplan
facilities.  The Company's  floorplan facility with Volvo Finance North America,
Inc. has a maximum  commitment of $3.3 million,  bears  interest at 1% above the
prime rate, and at December 31, 1997 and March 31, 1998 had outstanding balances
of $1.98  million  and  $2.8  million,  respectively.  The  Company's  floorplan
facility  with Nissan  Motor  Acceptance  Corporation  has a $3 million  maximum
commitment, bears interest at 1% above prime, and at December 31, 1997 and March
31,  1998  had   outstanding   balances  of  $2.3  million  and  $2.5   million,
respectively.

     Loans. In March and May 1997, Sirrom Capital Corporation  ("Sirrom") loaned
the Company a total of $7.5  million.  The Company  issued Sirrom a $3.5 million
convertible note, convertible until March 12, 1999 at $3.67 per share and a $4.0
million  convertible  note,  convertible  at $7.50 per share until May 12, 2002,
subject to adjustment.

     In  September  1997,  the  Company   completed  the  private  placement  of
convertible  notes in the aggregate  amount of  $1,050,000.  The notes mature on
April 15, 1998,  bear interest at the rate of 8% per annum,  and, since December
14, 1997, have been convertible into Common Stock of the Company at a conversion
price of 66 2/3% of the  average  closing  bid price for the five  trading  days
immediately  preceding the effective date of conversion.  Nearly $475,000 of the
debt had been converted into common stock by March 31, 1998. In conjunction with
the  borrowing,  the Company also issued common stock warrants for 52,500 shares
of the Company's  Common Stock  exercisable at $7.00 per share at any time prior
to August 29, 2002.

     In 1997 and 1998,  Eckler  borrowed a total of $8.5 million  from  Stephens
Inc. ("Stephens"),  the investment banking firm that is the managing underwriter
of the Offering to which this Prospectus relates. The loans bear interest at the
rate of 10% per annum and are  secured by all of the assets and common  stock of
Eckler.  The Company  guaranteed  the debt. The maturities of the Stephens loans
are as follows: $1.5 million on October 15, 1998, $1.0 million on June 30, 1998,
$2.0 million on June 30, 1999, and $4.0 million on September 30, 1999.

     In 1997 the Company completed an offering to institutional investors of 400
units of Series A Redeemable Convertible Preferred Stock and warrants at $10,000
per unit. Proceeds from the offering,  net of offering costs, were approximately
$3,965,000.  Each unit consisted of one share of Series A Redeemable Convertible
Preferred  Stock and a five year  warrant to acquire 300 shares of Common  Stock
for each preferred share purchased. The exercise price of the warrants are $8.10
for 90,000  shares and $5.23 for 30,000  shares.  At March 31,  1998 all but one
share of the Series A Redeemable  Convertible Preferred Stock had been converted
into Common Stock.

     In May of 1998, the Company sold to a private  investment  group 220 shares
of the Company's Series B Convertible  Preferred Stock for $10,000 per share for
an aggregate of $2,200,000.  The Series B Convertible Preferred Stock has an 11%
dividend per year and is convertible  into Common Stock at a conversion  rate of
$5.00 per share. After November 5, 1999, the Company may, at its option,  redeem
the Series B Convertible  Preferred  Stock for $10,000 per share.  In connection
with the  issuance  of the Series B  Convertible  Preferred  Stock,  the Company
agreed to certain  limitations on the issuance of additional shares of preferred
stock by the Company.

     Mortgage Loan. The Company has a long-term  mortgage payable to a bank with
a current principal balance of approximately  $2.5 million at a variable rate of
1.5%  above  prime.  The  mortgage  loan  is  collateralized  by  the  Company's
headquarters real property and machinery, equipment and fixtures. The loan terms
require  monthly  principal  payments of $13,333,  plus  interest,  and the loan
matures on July 1, 1998, at which time the Company  intends to negotiate a later
maturity.

     In  connection   with  an  acquisition   in  1997,  the  Company   acquired
approximately  7.92 acres of undeveloped land in Lake Mary,  Florida.  The land,
held for resale by the  Company,  is recorded  at  $1,050,000  on the  Company's
books.  The property is subject to a first mortgage in favor of AmSouth Bank and
a second  mortgage in favor of Barnett  Bank.  The AmSouth  debt had a principal
balance of $482,202 as of March 31, 1998, an interest rate of 7.75%, and monthly
payments of $8,683 until  December  2003.  The Barnett Bank note has a principal
balance of $600,000,  bears interest at 1% over  Barnett's  prime interest rate,
and requires quarterly interest payments. The note matured on April 1, 1998. The
Lake Mary property is presently  under contract to be sold to an unrelated party
in May 1998 for $1.3 million. Both mortgages will be satisfied when the property
is sold.

     Seasonality.  Historically, the Company's used car business has experienced
higher  revenues  in the first two  quarters  of the  calendar  year than in the
latter  half of the year.  Management  believes  that these  results  are due to
seasonal  buying  patterns  resulting  in part  from the fact  that  many of its
customers  receive income tax refunds  during the first half of the year,  which
are a primary source of down payments on used car purchases.

     The Eckler business is also subject to seasonal fluctuations. Historically,
Eckler has  realized a higher  portion of its  revenues  in the second and third
quarters  of the  calendar  year and the lowest  portion of its  revenues in the
fourth  quarter.  The business of Eckler is  particularly  dependent on sales to
Corvette  enthusiasts  during the spring and summer months.  This is the time of
year that  Corvette  enthusiasts  are  preparing for upcoming car shows that are
held in the late summer and early fall.

     Inflation.  Increases  in  inflation  generally  result in higher  interest
rates.  Higher  interest  rates on the Company's  borrowings  would increase the
interest expense related to the Company's existing debt. The Company cannot seek
to limit this risk by increasing  interest rates earned on its Finance Contracts
since the interest  charged is at or near the maximum  permitted  under  Florida
law.  Instead,  the Company will seek to limit this risk,  to the extent  market
conditions  permit,  by increasing  the profit margin on the cars sold. To date,
inflation has not had a significant impact on the Company's operations.

Recent Accounting Pronouncement

     In June 1997, the Financial  Accounting Standards Board issued Statement of
Financial Accounting Standards No. 130, "Reporting  Comprehensive  Income" ("FAS
130") and No.  131,  "Disclosure  about  Segments of an  Enterprise  and Related
Information"  ("FAS 131").  FAS 130  establishes  standards  for  reporting  and
displaying  comprehensive income, its components and accumulated  balances.  FAS
131 establishes  standards for the way that public companies report  information
about operating  segments in annual financial  statements and requires reporting
of selected information about operating segments in interim financial statements
issued  to the  public.  Both  FAS 130 and FAS  131 are  effective  for  periods
beginning  after December 15, 1997.  Adoption of these standards is not expected
to have a material adverse effect on the Company's financial statements.

<PAGE>
                                    PART II
                      SMART CHOICE AUTOMOTIVE GROUP, INC.

                               OTHER INFORMATION
                               -----------------


Item 2.  Changes in Securities and Use of Proceeds.

     Described below are the sales of securities by the Company during the first
quarter of 1998 that were not  registered  under the  Securities Act of 1933, as
amended (the "1933 Act"). On the issuance of these securities the Company relied
on the exemption from registration  under the 1933 Act set forth in Section 4(2)
thereof,  based on  established  criteria  for  effecting  a private  offering.,
including  the number of offerees for each  transaction,  access to  information
regarding the Company, disclosure of information by the Company, restrictions on
resale of the securities offered,  investment representations by the purchasers,
and the qualification of the offerees as "accredited investors."

     On various dates during the three months ended March 31, 1998,  the Company
issued Common Stock to holders of the Company's Series A Redeemable  Convertible
Preferred  Stock (the "Series A Preferred  Stock"),  on  conversion  of Series A
Preferred  Stock. The Company had issued the Series A Preferred Stock in 1997 to
institutional  investors. The Series A Preferred Stock was converted into Common
Stock at a  conversion  price that was based on the  market  price of the Common
Stock at the time of  conversion.  A total of  1,265,825  shares of Common Stock
were issued in the first quarter of 1998 on conversion of the Series A Preferred
Stock.

     On various dates during the three months ended March 31, 1998,  the Company
issued Common Stock to holders of preferred stock of a subsidiary of the Company
(the  "Subsidiary  Preferred  Stock") in exchange for the  Subsidiary  Preferred
Stock. The holders of the Subsidiary  Preferred Stock were accredited  investors
who had purchased the Subsidiary Preferred Stock in a private placement in 1996.
The exchange ratio for the exchange of Common Stock for the Subsidiary Preferred
Stock was 2.7 shares of Common Stock for each share of Subsidiary  Common Stock,
which was  determined  based on the  market  price of the  Common  Stock for the
period  January 21, 1998 through  January 30, 1998. A total of 648,00  shares of
Common  Stock  were  issued in the first  quarter of 1998 on  conversion  of the
Subsidiary Preferred Stock.

     On various dates during the three months ended March 31, 1998,  the Company
issued Common Stock to holders of the Company's 12% convertible  notes due April
15, 1998 (the "Notes") on  conversion  of the Notes.  The Company had issued the
Notes in 1997 to institutional and individual  accredited  investors.  The Notes
were  converted  into Common Stock at a  conversion  price that was based on the
market price of the Common Stock at the time of  conversion.  A total of 560,472
shares of Common Stock were issued in the first quarter of 1998 on conversion of
the Notes.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk.

     The  Company  does not invest or trade in  foreign  currency  or  commodity
transactions which would ordinarily be subject to market risk. The interest rate
on the Company's  revolving  credit facility with Finova Capital  Corporation is
based on the prime rate plus 2.5% percent.  Accordingly,  a significant increase
or decrease in the prime rate could affect the Company's earnings in the future.
The Company believes,  however,  that its financial instruments are disclosed at
their fair values. Fair value estimates are made at a specific point in time and
are based on relevant market  information  and  information  about the financial
instrument;  they are subjective in nature and involve uncertainties and matters
of judgment and, therefore, cannot be determined with precision. These estimates
do not reflect any premium or discount  that could result from offering for sale
at one time the Company's entire holdings of a particular instrument. Changes in
assumptions could significantly affect these estimates.

     Since fair value  estimates are as of a particular  date,  the amounts that
will  actually be realized or paid in  settlement  of the  instruments  could be
significantly different.

     The carrying amount of cash and cash  equivalents is assumed to be the fair
value  because of the  liquidity of these  instruments.  The carrying  amount is
assumed  to be the  fair  value  because  of the  relative  short  maturity  and
repayment  terms of the  portfolio  as  compared  to  similar  instruments.  The
carrying amount of accounts payable and accrued expenses approximates fair value
because of the short maturity of these  instruments.  The terms of the Company's
notes payable  approximates the terms in the market place at which they could be
replaced.  Therefore,  the fair value  approximates  the carrying value of these
financial instruments.


<PAGE>


Item 6.  Exhibits and Reports on Form 8-K.

                  (a)  Exhibits

<TABLE>
<CAPTION>

Exhibit
 List                 Exhibit Description                Filed herewith or Incorporated by reference to:
 ----                 -------------------                -----------------------------------------------
<S>       <C>                                               <C>

 3.1     Third Articles of Amendment to Articles of      Filed herewith.
         Incorporation.

 10.1    Ninth Amended and Restated Promissory Note      Filed herewith.
         dated May 11, 1998 between Florida Finance
         Group, Inc. ("FFG"), maker, and Finova
         Capital Corporation ("Finova") payee.

 10.2    Fifth Amended and Restated Schedule to          Filed herewith.
         Amended and Restated Loan and Security
         Agreement, FFG, borrower, Finova, lender.

 10.3    Promissory Note by Eckler Industries, Inc.      Exhibit 10.1 to Form 8-K filed March 5, 1998.
         in favor of Stephens Inc.

 10.4    Amendment to Guaranty Agreement between         Exhibit 10.4 to Form 8-K filed March 5, 1998.
         Registrant and Stephens Inc.

 10.5    Amendment to Pledge and Security Agreement      Exhibit 10.5  to Form 8-K filed March 5, 1998
         between Registrant and Stephens Inc.

 10.6    Promissory Note, dated February 24, 1998,       Exhibit 10.9 to Form 8-K filed March 5, 1998
         First Choice Auto Finance, Inc., maker, and
         Manheim Automotive Financial Services, Inc.,
         payee.

 10.7    Guaranty, dated March 21, 1997 from the         Exhibit 10.10 to Form 8-K filed March 5, 1998
         Registrant in favor of Manheim Automotive
         Financial Services, Inc.


 11.0    Statement re computation of  per share          Filed herewith.
         earnings.

 27.0    Financial Data Schedule.                        Filed herewith.

</TABLE>


         (b)      Report on Form 8-K

     In the three  months ended March 31,  1998,  the Company  filed a report on
Form 8-K dated December 10, 1997 reporting information pursuant to Item 5.

<PAGE>



                                   SIGNATURES



     In accordance  with Section 13 or 15(d) of the Exchange Act, the Registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized on May 15, 1998.

                                  SMART CHOICE AUTOMOTIVE GROUP, INC.


                                  By:   /s/ Joseph E. Mohr
                                  -------------------------
                                      Joseph E. Mohr
                                      Chief Financial Officer


     In  accordance  with the Exchange Act, this report has been signed below by
the following  persons on behalf of the  registrant and in the capacities and on
the dates indicated.

         Signatures             Title                               Date
         ----------             -----                               ----

/s/ Joseph E. Mohr          Chief Financial Officer,           May  15, 1998
-----------------------     (Principal Financial and
Joseph E. Mohr              Accounting Officer)