Good afternoon ladies and gentlemen. Welcome to the Penske Automotive Group First Quarter 2015 Earnings Conference Call. Today's call is being recorded and will be available for replay approximately one hour after completion through May 5, 2015 on the Company's Web site under the Investor Relations tab at www.penskeautomotive.com. I will now introduce Mr. Tony Pordon, the Company's Executive Vice President of Investor Relations and Corporate Development. Please go ahead.

Thank you John and good afternoon everyone. A press release detailing Penske Automotive Group's first quarter 2015 financial results was issued this morning and is posted on our Web site along with a presentation designed to assist you in understanding our performance. Joining me for today's call are Roger Penske, our Chairman; David Jones, our Chief Financial Officer; and J.D. Carlson, our Controller. On this call, we will be discussing certain non-GAAP financial measures such as earnings before interest, taxes, depreciation and amortization or EBITDA and EBITDAR. We have reconciled these measures in this morning's press release and investor presentation which is available on our Web site to the most directly comparable GAAP measures. Also, we may make forward-looking statements. Our actual results may vary because of risks and uncertainties outlined in today's press release, which may cause the actual results to differ materially from expectations. Additional discussion and factors that could cause results to differ materially are contained in our public SEC filings, including our Form 10-K. I’d now like to turn the call over to Roger Penske.

Thank you, Tony. Good afternoon everyone and thank you for joining us. Today Penske Automotive Group reported another outstanding quarter including record first quarter retail automotive sales, revenue, income from continuing operations and earnings per share. For the quarter, revenue increased 11% to $4.5 billion. Income from continuing operations increased 14% to 76.4 million and related earnings per share increased 15% to $0.85. First quarter was highlighted by strong performance across our retail automotive dealerships and our U.S. based commercial truck business. These results were partially offset by two notable items, first the impact of foreign currency exchange rates which reduced the company’s reported revenue by approximately 185 million and reduced earnings per share by approximately $0.05. And the challenging economic condition faced by Australia commercial vehicle distribution operations which experienced a year over decline of approximately $0.04 per share as the heavy duty truck sales in the Australian market declined 14.3% in the first quarter. Let me now turn to the specifics of the first quarter. Our quarter results were driven by 6.7% increase in total new and used vehicle retail automotive units to 101,350 units an 11% increase in total revenues to 4.5 billion. Our total revenue mix in Q1 U.S. 60% and our international markets at 40%. Approximately 93% of our revenue was generated through our retail automotive dealerships, while the remaining 7% was generated through our commercial vehicle businesses which include both U.S. truck and Australia and New Zealand operations. Overall gross profit improved 75 million or 12%, while gross margin improved 10 basis points to 15.4%. SG&A to gross profit improved 10 basis points to 77.6 and overall gross profit flow through was 23.3% however, within our retail automotive businesses, SG&A to gross profit improved 70 basis points and gross profit flow through was 36.6%.…

[Operator Instructions] And first question from line of James Albertine with Stifel. Please go ahead.

I wanted to ask quickly on the heavy-duty side of the business, Roger. Lot of great detail again this quarter. Thank you for that, and in the release. How does consolidation in that market differ in terms of the duration? So how quickly do you think you could help Freightliner as it relates to growing across interstates coast to coast? And then in the same token, how long -- or how big could it be as a percentage of your total sales over that period of time?

Well I think number one, just to put it in perspective, there’s 18,000 franchises in the U.S. from the standpoint of retail automotive, there's 2,000 truck locations so significantly less. We feel from a same-store perspective based on what we have today that we can grow our business by 50%. We have a framework agreement with Freightliner which allows us to grow to a certain levels. We think that over the next 12 months to 24 months that there will be plenty of acquisitions that we will be able to look at. And at the present time, we see the multiples on these significantly less than on the automotive side. We also have the benefit to grow with Freightliner who I said earlier has a 37% market share where there's a tremendous amount of opportunity and in the parts and service area. And I think overall as we purchased here in the last three months the business in Tennessee and Georgia and this just gives us a total of 16 full service dealerships and our estimated revenue will be about 900 million for 2015. So I see this we being able to double this business easily in two years

That is extremely helpful. Thanks for the color there. And then as a follow-up just wanted to compliment you first on your used to new retail ratio in the quarter, but then quite strong relative to your public peer group. Help us understand what Penske is doing as it relates to the used retail approach differently this cycle, maybe versus prior cycles, and why you think you can continue to expand that business from here. Thanks so much.

Well I think it started in our central area we went ramping out really focusing on used as we had the opportunity to utilize the Internet properly and I think that our websites, I think the way we handle the inquiries whether it's by tablet, by phone or internet we're doing a much better job in execution. Certainly our Penske car has played a big factor in that. And we have as what we call retail first. We have a metric. I think I've mentioned it before, the number of cars wholesaled versus retailed, that way we’re trying to keep that down somewhere around 15% to 20%. So that's driving, I think some ingenuity with our operators from the standpoint of what they can sell because these cars get marketed somewhere and I think that we're seeing that the success of that. Also we’ve invested in our facilities to give us more footprints in Atlanta. We have two BMW stores that sell each month over 250 used cars and this is because they have the space and also are working the process quite well using the Internet. The good news is we’ve increased the use. It helps us in our PDI, in our reconditioning which is key and I think that from our CRM perspective we're seeing a great work done by our people and the ability to control these ops, control these e-mails, control these inquiries that we get from the customers and the closing ratio is much better. So better execution number one, more inventory number two and selling cars that normally we would wholesale.

The next question is from Rick Nelson with Stephens. Please go ahead.

Roger, recall activity has certainly been a driver of warranty in service and parts. How much tailwind is still there -- there has been some parts shortages, I believe?

Well I think we looked at what the recall activity, how does it really impact us and I think it goes from 5% to 10% of our business. It's kind of lumpy. You get a big surge of recall and then you might not have any for three or four months. But overall today we're in this thick odd air bag recall. But it's a part of our business and I think if you think back ever since the inquiries by the safety area of the government and it’s with the auto manufacturers, any little defect that’s found on an automobile, since the General Motors' issue with a switch, it becomes a recall. So we're the depository for that work. And I think we'll continue to see that as part of our income stream on a going forward basis. I think recall business is good. We welcome it. I think that's why we've committed to the large fixed operations that we have in order to be able to handle it as it comes in. And I think that it also gives us a chance to think about this one, gives us a chance many times to see vehicles which we haven't seen. So it gives us a chance to connect with a customer with an order vehicle and in many cases we're converting those into either used car or new car sales.

Also, looking at your gross profit per unit and gross margin on the new car side here, one of the few dealers where we didn't see pressure there. And I am wondering how you execute that and whether it is sustainable.

My people tell me that's good management. But on a serious note, we really have two things that we follow in the company and that’s customer satisfaction and that’s margin. And with the premium luxury, we don't have the inner brand competition that we have some of the -- as we as we look at discounts and then dealer discounts and margins are really set up differently. So we get the benefit of that on a going forward basis. And because of our mixed is really almost 70% premium luxury, we see a little higher margin on that. So we've been able to maintain that. It seems that the premium guys always have a few units that are very tough to get, so we're getting maximum margins on those. So to me I think goods report card is as I mentioned earlier that the premium luxury actually went from 8.2 to 8.4 and an overall was 7.8. So to me I think it is management. I think the margins are key. And I would have to say that the manufacturers at least on the premium side are doing everything they can to sustain the gross, because we can't make these investments in corporate ID and facilities without maintaining a gross profit. So we're consistently in dialogue with the manufacturers to maintain that. And I think that's one of the things that we're also discussing even in the UK with our fellows over there that we need overall -- we need the ability to maintain this. So on the volume foreign, we are pretty much flat for the quarter and we were impacted somewhat in that because of the time that we had and with the bad weather in the Northeast and Central which hurt some of our margins there. So we were pushing to get inventory out to keep our day supply in order.

Got it. And the flow-through at the dealership level, I think, were 36.6% for the quarter. I think last quarter you were just under 30%. Do you think these are levels that can be sustained or --?

Our budget across the company is 30% to 35%. As we consolidate the truck business and the other parts of our business, we're going to take a look at that, but I would say our goal is 30% to 35%. Some of our peers have done a great job doing more than that but I think with our mix of business and the cost that we have associated in the premium luxury side, thinking that we have a caveat out in Orange County almost 400 loaner cars, and you start putting that into the cost base of your service, you’re going to have a higher fixed cost which you have to deal with. So to me we feel that overall we're really in good shape.

Our next question is from John Murphy with Bank of America Merrill Lynch. Please go ahead.

Just a first question on the Australian business, I know you are taking some action down there to rein in costs and set up the business for what is a weak environment now, but hopefully a stronger one down the line. Just curious if you can sort of outline some of those actions for us. And also if you think about this business in 10 years, 12 years, are we going to be looking back at something that is sort of analogous to Sytner, where it didn't look like that much in the beginning and it became a big platform and a great business for you over time?

Well look number one on action as I mentioned during my prepared remarks that we’ve consolidated our parts warehouse both for the power systems business and the commercial vehicle. This is a huge save. They have two big master parts warehouse. That's number one. We've reduced headcount and in fact if you looked what we did in the fourth quarter with power systems and moved into a profit in Q1, I think it was a byproduct of taking headcount out. There's many duplications in back office and functional areas in both businesses which we have combined. We looked it on the commercial vehicle side and also on the power system side. We're looking at areas that we were able to maybe we’re going to fishing. We had some places open seven days a week and we're not getting the benefit of that time and the cost associated with that labor. So we've made those moves. There's no question that we've put on more I would say often from a from a management standpoint, both on the sales we split the commercial vehicle side to both the Freightliner and Western Star separately to get impact with those dealers. And I think that overall when I look at the future and you talk about five years to 10 years I was in this business and we owned Detroit Diesel back starting in 1988. So we know the market. It's a loyal market and I would say that the Freightliner Western Star have a great reputation there. And I think that our ability and the off highway to be able to have that opportunity to sell these engines with only a few places in the world, can rebuild them. And we can do that, and Sydney gives us a real lever up. And…

Interesting. That is great. Thank you. On foreign exchange, I just wanted to make sure that everything we are looking at is pure translation and there is not an economic impact. And also, as we think about the cadence through the year, does this pressure ease as we get into this back half of the year?

Well I would say as we look at the pound it really went 1.68. I think in April 1.69 and it went through the next three months and 1.67, 1.68 and 1.69. So will have some impact because today we're sitting at about a $1.50, so we'll have some surely some headwind and as far as the euro is concerned we were in a $1.36 and I think as we look at the euro today it somewhere around $1.09. So I don't expect that to really mitigate itself in this next quarter we might see it in a third or fourth quarter.

And then just lastly, as we think about your customer base or your suppliers, if you will, being the automakers, there is a lot of talk about the German luxury manufacturers instead of shipping some vehicles over to a market in China, which is weakening a little bit on the margin for Lux, and shipping those vehicles over here to the US, just because the euro is weak versus the dollar and the flow is just easier for them. Are you seeing more of those vehicles showing up here? And are you seeing any price actions being taken by the German Lux manufacturers to try to move volume here a bit?

Well, I can tell you one thing. Land Rover which is the Range Rover has been very tight. We've got a major player there both in the UK and in the U.S. And we're seeing more availability than we've had. Also on the Porsche side we've seen that not only the sports cars but Cayenne and the Macan, because these are vehicles that were very popular in China even in the Q7 and some of the vehicles, that Audi. So to me we’re getting the benefit out of the slight slowdown because these were really markets where they could sell those vehicles at bigger margin they could in the U.S. or maybe in Western Europe. So my answer to that is, yes we're seeing those vehicles coming to us, I think it's going to play right into our hand with our premium luxury. In fact some of that availability, quite honestly helped our gross margin in the in the month of March in the first quarter.

That's helpful. And I promise this is the last one, just on currency. Would you ever consider doing a euro-denominated debt offering, considering that rates over there are essentially de-minimus? And given that you might want to make acquisitions or fund the business over there in Europe?

Our availability now as we mentioned it's almost 600 million. We have the ability through our banking sources and obviously the capital markets there the opportunity to do that. It's been something that's been discussed. I would think this point it's not the first thing on our list but obviously some will take a look at it.

And next we got Brett Hoselton with KeyBanc Capital Markets. Please go ahead.

Want to follow on the Australian truck ops. The $0.04 headwind in the first quarter, you have obviously made some changes here. On kind of a year-over-year basis, as we look at the second, third, and fourth quarter through the remainder of this year; would you expect that there would continue to be a headwind? Does it lessen? Does it increase? What are your thoughts there?

I think this year it’s going to be easier the comps will be easy as we get into the third and fourth quarter I think we'll still have a headwind here and in Q2 as way as we go forward but to me I think you’ll see some slow down of that deterioration in Q3 and Q4.

And then on the used vehicle, the gross profit per unit, it looks like about half the decline was due to FX. But even ex-the FX impact, it looked like there was still a notable decline in gross profit per unit on the used side. Can you kind of give us a sense of what might have driven that? And is there -- is that structural permanent or is that kind of just a softer quarter and it will probably rebound?

Well I think if you look at Slide 12 that Tony sent out giving you'll see that excluding exchange we were down $88 or 4.6% from the standpoint of used on exceed dollar basis. So to me this is pretty much in line with the market as we reviewed the peers and what they've been dealing within the marketplace and again we were moving a lower cost of sale vehicle in some cases. And I think that drives a little bit lower margin as these lower price vehicles. but I think, the key think is the sequentially, if you look at Q4 forget the numbers whether it’s minus 4 now we were up 50 basis points. So I think we’re going in the right direction.

And next go to Paresh Jain with Morgan Stanley. Please go ahead.

A question on the CV business. You have talked about how defensible the CV business is, with 70% of gross profits coming from parts and services. But when we think about a comp for that business, obviously, Rush Enterprises comes up. Now Rush is, I would say, a much more mature comp and doesn't have the same acquisition run rate as Penske. But other than that, would you highlight any other key differences between Rush and Penske? Penske CV business rather.

Yes, it’s a good question. Number one most kind of look at the market leaders, when you look at Peterbilt and Navistar combined they have about 26% of the overall heavy duty market. We’re sitting with Freightliner with 37%. And to me there is more opportunity from us from a parts and service business, because of the units and operation with Freightliner. We’ve committed today under our framework agreement to grow with Freightliner and they are encouraging their partners across the country for us, that for us particularly but for people who want to consolidate to get into that business and I think that means a lot to us. Also from a product standpoint Freightliner has not only a heavy duty offering, they also have a medium duty. Peterbilt has a heavy duty and more of an owner operator truck that has been used primarily not only on highway, but more recently I guess in the oilfields and we are not really servicing that many trucks in the oilfield as Peterbilt would be. Navistar on the other hand is coming through kind of a change of life with our engine strategy and other thing. So we don’t see them having the customer loyalty that we have with Freightliner and when you look at Freightliner all the big fleets that the Wal-Mart, you look at night, you look at U.S. Express, you look at Schneider, you look at J.B. Hunt, you look at Rider, you look at Penske. All of these are large Freightliner customers and the units and operation drive a 100% of the parts and service back to the dealership. So, to me a units and operation plus a smaller base of locations for us to cover the U.S., which gives us a better opportunity. More over the road…

That's helpful color, actually. On the light vehicle business, your same-store new growth in US, one of your peers called out weather in Northeast having an impact on sales as well as cost. You have some presence there as well. How much was that an impact in the quarter and how has demand been since then?

Well, I said, I want to got give a weather report on this call but you brought it up. We obviously were impacted significantly in the northeast Connecticut, Rhode Island, into New Jersey even down into Washington, in March we had the time when Washington was down. So I would say that it had a big impact to us. To say what brands, I would say in the Premium Luxury side 50% of our Mercedes business and BMW business is in Northeast in our Porsche we have a strong Porsche, three out of our 60 internships are in the northeast and our BMW business really -- the main one there was impact would have been new acquisition we made in the Greenwich area.

Next question is from Patrick Archambault with Goldman Sachs. Please go ahead.

A couple of quick ones, like a bunch have been answered. But just following up on the used margins I guess it was kind of flatten sequentially, but was still down year-on-year, as per one of the previous questions. I think you had mentioned that there is kind of your first -- your Retail First strategy I guess that’s playing a role there. But how do we think about the trajectory of that number in subsequent quarters? We keep on waiting for the inventory to improve from an off-lease cycle. Is that something that is likely to help out and improve acquisition costs and improve margins?

I think there's hundreds or thousands of off-lease cars coming from BMW, Mercedes and other premium manufactures and I think pretty much in full swing now that's going to give us an opportunity for us to be able to acquire those cars and the good news is that they give us the benefit of some of the new car rates as we go forward with those program. One thing it has had some impact with us and that internationally BMW wish to get £250 on used financing and that that's been taken away from us in this first quarter. We are having this switch some of that financing through a second source but we need the BMW relationship because of the customer information. So that's been something that we're dealing with the market condition as BMW obviously trying to take that money off the table. So we think that with that in place and also VAT gives us a little bit lower margin. I think from a retail first perspective that's right on top of mind, and we’ll continue that we will continue to do better. With our internet, we can see is a model of some of the stores in the central now even the east and west that are really taken on this inventory and the ability to execute, with the internet I think all appears see that the internet is a powerful tool and we're getting better at that and I'm not sure that from a margin standpoint we can put less money in the trades and make less money on the front end too if you're looking at and trade so that can move around depending on the work 0.90 you follow me to the new now so we're almost getting one to one, where I want to wanted some market. So to me I feel good about where we are, looking at our peers that we're all within that 40 to 60 basis points reduction during this quarter. First quarter might be the toughest too because of the weather.

Okay, so a little tough to call but certainly some levers that you can pull sequentially seems like. And then I mean just to recap what you said right on the new site I mean it does look like some of the gains you saw year-on-year are holdable. Well actually that's more my question. It sounds like especially in luxury the kind of the pricing environment was a little bit better for you. How do you think about the sustainability of that as we get into Q2 and the back half?

Well I think if you if you look at our Premium Luxury margins they've been pretty consistent over the last several quarters and for me that that shows that we're managing the growth properly because we have been somewhere in the 4150 to 4160, all the way back to the second quarter of 2013 but I think if you average that we’d be right around 4150. So I think it’s sustainable, we certainly shown it over the last five quarters, I don’t see any reason and that shouldn’t change.

Okay, I appreciate the color. One last one just – on the M&A outlook, you had previously talked about a split between traditional car dealership opportunities and other businesses and can you just -- with the perspective of yet another quarter behind you, how do you see the way you are thinking about allocating capital going forward?

Well, number one, we are going to be in our opportunistic buyer. We want to be consistent with the brands that we represent where we have large campuses we would like to glue on adjacent businesses. I think the market is still highly fragmented. The consolidation process is slowing taking place, I think we have seen some higher numbers on some of the premium luxury deals that have gone down here lately. On the other hand, we see opportunities on the commercial vehicle side and we bought the Land Rover business in Greenwich and Darien here that obviously plays into our hand because it’s complimentary to our existing footprint we have in that particular market. So we will continue to but I think I say our strategy are book sales. So we want to grow at 10% or top-line growth in our budget and 50% and that would be on a same-store basis and we would grow through acquisition another 5. And obviously last year 11% on same-store. But to me, I think that the balance sheet we have with the liquidity of about 600 million, there’s no question we put our senior debt away last year or senior sub debt 850 million for the next 10 years. So we have plenty of liquidity and there is no question that in the UK that the cash flow, we generate auto Sytner and the international markets, which allowed us to invest into Australia. Basically there is no issue from a tax standpoint we can repatriate the money back and forth without any incremental tax impact, so to me that’s opportunistic. We’re getting calls from OEM to invest more in the Western Europe part of the marketplace which in some of these deals are very attractive to us. In fact, I talk…

Our next question is from David Whiston with Morningstar. Please go ahead.

Continuing with the M&A idea of moving to Australia, with the slowdown in their economy there, are you getting approached by more businesses wanting to sell to you?

Well, I think this still ore body is clear, when you look at Australian, we’re a distributor, we’re like Southeast Toyota is with Toyota Gulf States in the U.S.. We actually source the vehicles from the manufactures M&A and Germany Western Star from Daimler here in the U.S. and Dana Segal in the U.K. Then we have a dealer base that we support, we have two of our own stores one in Brisbane, which is in Australia and the other in Auckland in New Zealand. Those are the only two we have. So we’re monitoring if some of our dealer base wants to sell, we’ll take a look at it, but the concern is that we’ve been in competition with our dealers in some cases. So we feel that the best for us is to support them either if they need capital, we support on facilities or even as we’re doing a lot of training right now free of charge to the technicians. I think that gives us this exclusive distribution into those dealerships. So from the standpoint of other marks, I don’t think today that you’ll see us move into another market pretty well covered by either local distributors or local OEMs or the OEMs that have their local sales companies at this particular time. I think the key thing we have to look at is the health of our dealer network and that’s something that obviously is on the radar due to the just overall slowdown. The good news is that most of them have strong parts and service businesses. As we said earlier that covers over a 100% of their fixed costs.

Thanks that’s helpful for the clarification. Moving to Europe, what's your take on the health of the consumer there, are there reasons to be really aggressively optimistic for the rest a 2015 and 2016 I think it's been very slow and steady?

Well I think that when you look at the UK I think I've seen the information that consumer confidence is a 12 year high and there's low unemployment which is driving more wage and there's no question we look at unemployment just deep below 6% I guess the lowest it’s been over the last 5 or 6 years. And the GDP is probably going to grow at about -- but somewhere between 2.5% and 3% in 2015. So, inflation rate was zero. When I look at Spain, I look at Italy and our opportunities there continue to grow our businesses year-over-year are growing probably in at least 10%. So to me those markets are getting better and we’re represented there exclusively in the Premier luxury in those markets and we see those markets in good shape. Obviously there's always political ramifications but the relationships we have with the OEM's it seems that they're very interested to see us invest more in those markets and we have a very good management structure. David Holmes, one of our key guy is really -- and Jens Werner -- have taken over that market for us and report into the UK but very proactive. We've got partners with say 20% to 30% ownership that have local knowledge they know the social behavior need to be in those markets. We bring our expertise on the auto side. So I would say that today its working minimal commitment from the standpoint of capital I mean these are deals that we never see them in this country. So getting in now is if that market starts to get better we're going to have that tailwind.

Okay. And my last question is on the U.S. market. I wanted to continue the conversation we're having in the last quarter's call on Cadillac at the time you’d expressed an interest in them at least in the right markets of getting some Cadillac and Lincoln franchises. So is it fair to say that you do think Cadillac's renaissance with things like the CT6 they can actually be a formidable competitor to the German 3 and Lexus?

I love the CT6 and quite honestly we're in the process right now talking to Lincoln about potential location for them I think the commitment that Ford's making to that brand again an opportunity to get in without any significant goodwill will make a huge difference. There's no question that from a Cadillac perspective they're down in the first quarter, but de Nysschen who is the general manager of that division came out of Audi and I think he's got the right attitude, there's no question reading the papers here in Detroit knowing that folks here, they’re investing in Cadillac they've got the escalate to bring out some new product. Understand maybe a smaller version of that which has been very successful as they try to transfer some of their customer base into the smaller SUV space I think that is only going to bode well for both Lincoln and for Cadillac.

And we have question from Michael Ward with Sterne, Agee. Please go ahead.

Good. Roger, I wonder if you can talk a little bit about factory maintenance. I don't know what percentage of your current sales include a factory maintenance program? And it seems like that is going to -- a trend that is going to continue. And is the profitability for factory maintenance any different than you would get from normal customer maintenance? How does it impact the customer service experience, the loyalty, and those sorts of things?

Well, you got your full circle program with BMW we've had for a long time we're basically someone can come and lease the car other than gas and consumables that’s all they spends during 24 to 30 to 36 months lease. The work that we do on that would be chargeable on warranty so we get our full margin on labor which is very positive to us and that drives that customer back into the dealership. So to me from a BMW perspective we're seeing big increases in our in our parts and service business from a BMW perspective also Toyota has Toyota care and when you think about Toyota this is been something they put in place after they had some of the issues with product acceleration et cetera. And that’s that are home run for us, we give free all changes for the first two years and I think that’s been key for us. There is no question, when you look at the brands that have that. I think on the BMW side, our parts and service growth is gone up 20% during the quarter due to the parts and service. And again a lot to do with our growth and sales, but also their support of that. And when you look Toyota, we’re probably up 5% or 6% and I think that’s key. These are good, I think reset your values on vehicles that are in these programs are better, which helps us. And when you look at warranty, we were up about 16% for the quarter without foreign exchange and with foreign exchange were up 19%. So we see those programs being quite positive. From our perspective today, we have United Auto Care which we sell on the use car side and I think that some benefit of that do we go into that business right now, I think that’s something you want to evaluate, when you get our scale. But to me that just more share of wallet, I like the fact that the manufacturers apply these warranties, we can sell them there recommended to the consumer. In many cases these warranties, we sell, we take a demonstrator or a loaner car and we bring those back into the market or even these used cars, we get some of these programs that have extended warranties added to the sale of those vehicles which is quite good and attractive to the to the consumer. So I think it’s part of the business, there are always going to be different who wants to supply without, today different than what we have and I think you see more OEM supply in the future.

I would assume it strong competitive advantage for BMW and Toyota?

I think that we’ve almost take it for granted, but it’s quite a selling tool, when you think if you have a least and you’re going for 13 months and all you do, we call I guess and going. Then we’re doing selling even a product around that this is all you’re going to do as put gas in your car and it also will reduce have a lower costs of ownership which searches the end of the day no matter what’s the total costs and I think that’s part of it.

And Mr. Penske, no further questions in queue.

Alright John, thanks everybody. Thanks.