GPI
#Yeah, this is <UNK>.
That's a good question.
There is dramatically increased supply on used vehicles.
And that does put some pressure on the margins I think.
But the good news is the used vehicle market appears to be quite strong.
Even in the market like Oklahoma where new vehicle sales were down 18%, used were only down 2% or 3%.
And in some months the markets' still somewhat flat on used.
But yes, there's more supply which will give us more volume opportunity but it will probably have a little bit of margin trade-off.
Jamie, this is <UNK>.
Our F&I performance in both Texas and Oklahoma still remains good.
I think the, the biggest headwind that we would base on F&I is rise in interest rates.
But so far as you can see we've produced and with the volume that we do in Texas and Oklahoma, F&I is held up.
Yes.
The PRU, said differently, PRU is held up, Jamie.
It's just the volume impact that rolls through.
Directionally, yes but there's some trade-off with the CPOs which come with the off lease vehicles.
Yeah, to a certain degree.
I don't think you can really leverage SG&A when you're down 10% or 18% because a certain percentage of your personnel costs are fixed.
But yeah, we adjust the best we can on both personnel costs, advertising and you've seen the work we've done on inventory.
We're pretty good at flexing the cost structure but it's not like you can really leverage when your sales are down that much.
This is <UNK> <UNK>el.
The volumes were down that much but as we indicated, we saw the same improvement in margins in those markets as we did overall.
So, you know, the gross profit dollar were not pressured nearly as much as the volume headline would make you think.
So that's why you're able to hold the profit decline to about that level.
Yes, <UNK>.
There's probably been an explosion in deals in recent months in both the US and the UK for obvious reasons.
I don't have any indication that prices are more reasonable, but I think they will become more reasonable.
Just because of supply and demand there.
There are many people that understand that, the market growth isn't in the same profile potential as it was a few years back.
That was just coincidental, <UNK>.
We are just always cleaning up.
Sometimes you come up on a CapEx point where you have to invest in a facility and generally if the dealership is in a good return now, more CapEx isn't the answer to your problems.
So those are mostly clean-up actions.
I wouldn't read anything into that.
We're still interested in expanding our company in all three of the markets if we can find opportunities that are return on investment hurdles.
What we look at is rent adjusted total leverage and we're just around, kind of the high 3.8s close to 3.9.
We really, from a protect the balance sheet standpoint don't want to go much above four times so there's a little bit of dry powder.
If it was really the right deal, you might stretch for a short period.
But in general we really kind of want to protect that four times cap.
Thank you.
Thank you, <UNK>.
<UNK>, it's <UNK>, <UNK> <UNK> .
We probably have as much communication and interaction with our lenders as we've had and I will tell you from our perspective we have not seen a pullback in credit whether it's the US or in Texas.
Not really easily.
Our sense is that, you know, overall used vehicle prices have been pretty solid.
But I can't really give you an analytical cut of how much of is that is mix versus like-for-like.
For our mix I would tell you that Mannheim is probably a little more accurate.
Okay.
Thanks everyone for joining us today.
We look forward to updating you on our fourth quarter earnings call in February.
Have a good day.
