Penske posts profit, Smart cars lag behind 07/30/2010
Robert Penske, who owns a holding company for auto dealers known as Penske, pulled off a coup by becoming the exclusive distributor for Smart cars in the United States. But while his business is booming overall, Smart cars have yet to prove the big hit for him that he thought they would.
Penske nearly doubled its profit during the second quarter of 2010 as compared to a year prior, according to Reuters. The second largest auto dealership in the U.S. had net income of $29.4 million, or 32 cents per share, as compared to the previous total of $14.1 million, or 15 cents per share. That figure beat Wall Street's estimate of 29 cents per share, according to a survey of analysts by the news source.
Much of the profit was due to a surge in new car sales, which were up 24 percent. The top earning brands for Penske included BMW, with 20 percent of sales, and Toyota, with 18 percent.
One brand that didn't contribute as much was Smart. In fact, Smart cars cost Penske two cents per share, although that figure is up from 2009's four cents per share.
Smart cars, while popular overseas, have yet to truly catch on in the U.S. However, the microcars are technically the most fuel-efficient gasoline powered vehicle in the country, and still the fourth most efficient overall once hybrids are factored in.