Operator: Our next question is from Glenn Chin with Seaport Research Partners. Please proceed with your question.
Glenn Chin: Can you speak to the divergence in new unit performance by segment, luxury import domestic? Was it a function of the issue you touched on David, that of pricing content of vehicles versus what consumers were looking for and that the fact that some of the domestic OEMs were slow to react with incentives?
David Hult: Sure. And obviously it varies by market, whether it’s Southeast, Southwest and so on Midwest. I tell you as you can see in our earnings release, on the import side, our largest flying brand is Toyota. The entire quarter we had a single day supply of vehicles. And really the hot models, we didn’t really have much inventory at all. Honda was our second and we had an extremely most of the quarter single day supply. It jumped up towards the end of the quarter, close to mid-teens day supply. So the demand was there and the volume was there to do more we think at a healthy margin. On the luxury side, Lexus is usually our number one volume. Again, during the quarter, we had a single day supply of Lexus, and we know our sales were governed in the quarter, and there were more sales available, and a lot of cars were pre-sold there.
We still see pretty good demand on the luxury side. Now it’s model-based and it’s certainly whether it’s combustible or EV. But as we sit here today, we think our headwinds are getting our cost structure down on domestic vehicles. And we think we’re fairly well aligned on the import and luxury side at this standpoint.
Glenn Chin: All right. So before when you talked about the issue, David, you mentioned that the domestics were slow to come to the market with incentives. It — question is, has that changed or do you expect it to change, you expect them to come to market?
David Hult: Sure. Stellantis is the one that has the biggest impact on us. We have over 60-day supply of Stellantis. We also have stop sale trucks in truck markets that make it difficult, so that’s going to govern your sales as well. And their incentives have continued to increase but they were slow to come to the table. So we have heavily contented trucks with incentives that are catching up, and we still have stop-sale vehicles as we sit here today.
Glenn Chin: Okay. And just to confirm, David, that’s primarily Stellantis, you’re not speaking of the big three overall?
David Hult: Yes. I would say again from a balance standpoint, we’re seeing a majority of it with Stellantis right now.
Glenn Chin: Okay, very good. And then just a quick housekeeping question, on Clicklane, you normally specify the percent of customers that are new to Asbury. Can you share that for this quarter?
David Hult: Sure. It was — I think it was the same number as last quarter. It was 92%.
Operator: Our next question is from Bret Jordan with Jefferies. Please proceed with your question.
Bret Jordan: Could you give us an update on the insurance product that you’d acquired through the Larry Miller acquisition? And I guess is there any obviously it had some internal accounting issues, but is that changing the cadence of that rolling out across the broader Asbury network?
David Hult: So just an update on that. We’re rolling it out through our legacy stores. We’ve rolled it into Colorado stores, Texas and St. Louis. We still have our large markets of Georgia and Florida to go later this year. And so we’re making good progress on getting that rolled out, but it is a kind of steady progress over the remainder of the year. The deferral of that income as we roll it out to our legacy stores, that’s kind of the hit we take year one and then we get to recognize that income over the product life cycle. And so you’ll see that hit kind of rollout toward the end of the year as we put on some of these larger groups in Georgia and Florida. So we’re making good progress kind of on target for what we thought we’d be. It’s just a slow process throughout the entire 2023.
Bret Jordan: Okay. And I guess with another quarter under your belt, do you have a feeling for sort of the cadence of the GPU trend? I think in your prepared remarks, you talked about sort of a two-year trend that whatever the new normal is and maybe lower selling expenses. But when you think about sort of the mix of incentive and inventory recovery and obviously high rates, are we in a world with sustainably higher GPUs than pre-pandemic? Or do you sort of see it going back to the 2000-ish new front ends?
Dan Clara: Hi, Bret, it’s Dan. Good morning. It’s a supply and demand proposition. And with the current inventory levels that we have, we see that sustaining the moment that we see higher day supply come in and the higher availability of used cars then certainly that’s going to have a — an impact to the GPUs. But I think we’re a little bit away, I don’t know exactly how far away we are, but it’s not in the near future.
Bret Jordan: Okay. But do you think we’re structurally higher? Do you not expect us to see those pre-20 numbers again on new GPUs? Or are we sort of trending over the long-term back to where we were prior to the surge?
