Unknown Analyst's questions to Penske Automotive Group Inc (PAG) leadership • Q3 2024
Question
An analyst from Guggenheim Securities asked for clarification on the residual impact from the CDK cybersecurity incident, an update on the commercial truck order book amid freight market softness, and the expected flow-through benefit to parts and service from stop sales in future quarters.
Answer
Richard Shearing, Head of North American Operations, clarified the CDK outage primarily impacted the commercial truck business, resulting in a minimum $7 million negative impact across Q2 and Q3 due to lost productivity. He noted that despite a freight recession, truck demand remains healthy for replacement cycles. Roger Penske, Chair and CEO, added that parts and service strength is driven by a 7% increase in technicians and higher complexity in BEV repairs. The net impact of stop sales was a $4 million gross profit reduction, as a $6 million sales loss was partially offset by a $2 million gain in fixed operations.