Yahoo News Elon Musk may accept bitcoin for a Tesla, but this CEO says not at his auto dealerships
AutoNation CEO Mike Jackson isn't yet sold on the notion of accepting bitcoin as payment for his used or new vehicles, counter to what Tesla CEO and crypto pusher Elon Musk recently said will happen at his company sometime this year.
"I would note that I served the Federal Reserve System with pride and honor for nine years, ending up as chairman of the Federal Reserve for Atlanta. I am absolutely astounded and amazed at what bitcoin is worth today. I don't know where it's going and what it all means. So I can't help there, other than to say look what I do. I don't anticipate us [AutoNation] accepting bitcoin, and we really haven't had hardly any customers suggest that we accept bitcoin. So we are good with the U.S. currency," Jackson told Yahoo Finance Live.
Judging by AutoNation's latest earnings report on Tuesday, it may not need the bitcoin payment option in 2021 (if at all). AutoNation — which operates 315 retail locations across the country — handily blew away sales and profit forecasts for the fourth quarter announced Tuesday. Shares rose about 4% in afternoon trading Tuesday.
The company saw same-store sales climb 5%. Underscoring the strong consumer demand, AutoNation said its new vehicle and used vehicle gross profit rose 50% and 9%, respectively, from the prior year. The company delivered sales gains in each vehicle segment: domestic (up 7.2%); import (up 3.5%) and premium luxury (up 4.5%). Operating profits in each vehicle segment also increased, paced by a 64.3% gain in domestic autos.
"While there is a terrific economic pain out there for America [because of the pandemic], there has been a prioritization around personal transportation rather than shared transportation. You combine that with very attractive interest rates, very affordable gas prices and fiscal incentives that are coming, the demand is exceptional," Jackson said.
AutoNation also added two sweeteners for investors in the release.
The company said it exited its stake in online car seller Vroom, which it originally invested in October 2018. AutoNation's realized cash gain on the investment was $165 million. The company also revealed a new $1 billion stock buyback plan, something the Street has speculated could come given AutoNation's relatively clean balance sheet.
Brian Sozzi is an editor-at-large and anchor at Yahoo Finance. Follow Sozzi on Twitter @BrianSozzi and on LinkedIn.
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