Whether owning or leasing a new or used vehicle, having it serviced or renting a car, AutoNation wants to make itself the brand customers think of for automobiles in the same way people think of McDonald's for hamburgers or Blockbuster for videos.
The chain, so far consisting of eight used-car megastores, is the creation of entrepreneur H. Wayne Huizenga, chairman and co-CEO of Republic Industries, and his protege Steven Berrard, a prodigious dealmaker and Republic's president and co-CEO.
Messrs. Huizenga and Berrard, along with Toyota distributor Jim Moran and other investors, founded AutoNation USA as a used-car superstore chain in late 1995.
AutoNation operates a second chain-Valu Stop-selling used cars four years and older in age and carrying between 150 and 200 cars on the lot.
BEYOND USED CARS
But AutoNation has moved beyond used cars. In recent months Republic, AutoNation's parent company, has bought a series of automobile dealerships and rental-car companies. Eventually the AutoNation logo will go up on those new-car dealerships.
Within a matter of months, Republic has rocketed from out of nowhere to become the No.1 U.S. dealership chain. At last count, Republic had acquired dealerships with sales totaling about $5 billion in 1996, enough to pass Hendrick Automotive for the top spot on the Automotive News Top 100 Dealers list.
Republic has fueled its multi-billion-dollar buying spree with shares of its own highly valued common stock. The corporation is buying new-car dealerships in the same top 50 markets where it plans to build AutoNation superstores. So far, those stores are predominantly in Sunbelt states.
RENTAL SYSTEMS ADDED
To help build AutoNation's inventory, Republic within the last six months has bought Alamo Rent-A-Car and National Rental Car Systems. These purchases have made Republic a major player in the rental business, and the holding company has started integrating its auto rental and sales units.
Alamo rental counters are in all AutoNation stores, and Alamo cars will be available to AutoNation customers whose vehicles are in the shop, says Thomas Gruber, Republic's senior VP-chief marketing officer.
More importantly, the addition of the car-rental business helps close the circle on Republic's auto enterprises. The company's grand strategy is to sell or lease new cars through Republic's new-car dealers, rent late-model vehicles just off lease or traded in through Alamo or National, and resell them through AutoNation used-car lots.
AutoNation is expected to announce some type of cooperative venture in the finance, warranty and service and parts business.
AutoNation's big-picture strategy originates with Messrs. Huizenga, who turned garbage-hauling and video rental businesses into Waste Management and Blockbuster Video, respectively, with Mr. Berrard and other executives.
Among the longtime associates is Mr. Gruber, who's served in marketing positions at Blockbuster and McDonald's Corp.
He'll oversee integration of all Republic brands, having been recently promoted to the corporate position from AutoNation's senior VP-chief marketing officer.
John Drury, founder of Harris Drury Cohen, Fort Lauderdale, Fla., replaced Mr. Gruber as AutoNation's marketing chief.