Group 1 Automotive (GPI)

Risks

• Availability and demand for and pricing of our products and services may be adversely impacted by economic conditions and other factors.
• Deterioration in market conditions or changes in our credit profile could adversely affect our operations and financial condition.
• We may fail to meet analyst and investor expectations, which could cause the price of our stock to decline.
• We are subject to risks associated with our dependence on manufacturer business relationships and agreements.
• If we are unable to enter into new franchise agreements with manufacturers in connection with dealership acquisitions or maintain or renew our existing franchise agreements on favorable terms, our operations may be significantly impaired.
• Substantial competition in automotive sales and services could adversely impact our sales and our margins.
• Changes in consumer demand towards fuel efficient vehicles and EVs, and resulting shifts by manufacturers to meet demand, could adversely affect our new and used vehicle sales volumes, parts and service revenues and our results of operations.
• We are subject to risks resulting from the planned divestiture of our Brazilian operations which could result in an adverse impact to our operations, financial condition and business.
• Our inability to acquire and integrate successful new dealerships into our business could adversely affect the growth of our revenues and earnings.
• Vehicle manufacturers may alter their distribution models.
• Vehicle technology advancements and changes in consumer vehicle ownership preferences could adversely affect our new and used vehicle sales volumes, parts and service revenues and results of operations.
• The COVID-19 pandemic, which has disrupted all of our dealership operations, has had, and could continue to have a material adverse effect on our business, results of operations and cash flows.
• A cybersecurity breach, including loss of confidential information or a breach of personally identifiable information (“PII”) about our customers or employees, could negatively affect operations and result in high costs.
• Our insurance does not fully cover all of our operational risks, and changes in the cost of insurance or the availability of insurance could materially increase our insurance costs or result in a decrease in our insurance coverage.
• Natural disasters and adverse weather events can disrupt our business and may adversely impact our results of operations, financial condition and cash flows.
• Risks associated with our international operations could have a material adverse effect on our business, results of operations and financial condition.
• We are subject to automotive and other laws and regulations, which, if we are found to have violated, may adversely affect our business and results of operations.
• Operational risks associated with environmental laws and regulations may expose us to significant costs and liabilities.
• The impairment of our goodwill and/or indefinite-lived intangibles could have a material adverse effect on our results of operations.
• New accounting guidance or changes in the interpretation or application of existing accounting guidance could adversely affect our financial performance.
• Our internal controls and procedures may fail or be circumvented.