From a brand standpoint, the company has concentrated on leading manufacturers that have demonstrated the ability to produce world-class products that are popular with customers. The balance is comprised of other leading manufacturers. The company's investment strategy is focused on return on investment and is funded with internally generated cash flow, debt and, subject to market conditions, common stock. Based on a risk-adjusted analysis of expected returns, the company allocates its resources between expanding current operations, acquisitions and common stock repurchases. Acquisitions are designed to immediately enhance earnings per share.
Platform acquisitions are large, multiple-franchise dealerships in attractive markets.
Platforms are operated by superior management teams that partner with Group 1 to expand their market share. The executive team has an impressive track record of managing public companies, raising capital, completing acquisitions and operating in the automotive retailing industry. The diversity of the company's products and services, combined with seasoned management and a highly variable cost structure, gives Group 1 the flexibility to execute its strategy in a changing business environment. The company expects 2001 to be a watershed year, one in which the automobile manufacturers are forecasting new vehicle sales in North America to slow from the record pace of 2000. Group 1 believes that this environment will give the company the opportunity to validate its business model by proving its flexibility.