Sonic Automotive reported $360.10 million in parts, service and collision revenue for the fourth quarter of 2021 — an increase of 12.8% compared to the same period a year ago with same-store sales up 8.7%.
Same-store parts, service and collision repair gross profit grew 6.6% to $165.50 million with same-store customer-pay gross profit up 18.3% and same-store warranty gross profit down 13.6%. Same-store gross margin decreased 100 basis points to 49.7%.
Analysts with Jefferies LLC wrote in a Feb. 16 report that service is a bright spot for Sonic tied to customer-pay. “We continue to expect steady recovery in the segment as [vehicle miles traveled (VMT)] approaches pre-COVID levels, while we note Sonic is aggressively hiring technicians and adding capacity in certain brands,” Bret Jordan and Ethan Huntley stated. “Further, Sonic should continue to benefit from the economic recovery in California, as the state represents a significant portion of Sonic’s revenue and has lagged the country’s broader reopening.”
