SUNNY ISLES BEACH, Fla. — Icahn Automotive suffered a $13 million operating loss for the quarter ended March 31 on $441 million in sales revenue.
Icahn Automotive, a business unit of Icahn Enterprises L.P., reported revenue dropped 20.3%, a decline attributed to the deconsolidation of the Auto Plus auto parts business — which filed for Chapter 11 bankruptcy protection in January — from the unit's accounts.
The ongoing Icahn Automotive business — which comprises predominantly the Pep Boys auto service chain — generated a revenue gain of $16 million in the period attributed to higher automotive service sales, which now account for nearly 84% of Icahn Automotive's revenues.
Icahn Enterprises noted that the automotive segment's results of operations are generally driven by the demand for automotive service and maintenance, which is impacted by general economic factors, vehicle miles traveled, and the average age of vehicles on the road, among other factors.
The segment has been in the process of a multi-year transformation plan, which includes a number of priorities, including:
- Positioning the service business to take advantage of opportunities in the do-it-for-me market and vehicle fleets;
- Improving inventory management and tire distribution network;
- Investment in capital projects within Icahn Automotive's owned and leased locations to increase leasing revenue and reduce occupancy costs;
- Investment in customer experience initiatives and selective upgrades in facilities;
- Investment in employees with focus on training and career development; and
- Business process improvements, including investments in supply chain and information technology capabilities.