1

NADA Press Conference

February 5, 2011

2

Rental: Stability Ahead

New vehicle sales into rental stabilizing at “new normal”.

Shift from program cars to risk units is completed.

Increased service life for risk units has leveled off.

Off-rental prices will show stability at current high base.

3

New Vehicle Sales Into Rental &Rental Fleet Size

0.8

1.0

1.2

1.4

1.6

1.8

2.0

2.2

1998 2000 2002 2004 2006 2008 2010

Mill

ions

New Purchases Average Fleet Size

Source: Bobit Business Media

4

Distribution of New Vehicle Sales into Rental - Program versus Risk

0%10%20%30%40%50%60%70%80%90%

100%Program Risk

Source: Bobit Business Media & Manheim Consulting

5

Average Mileage – Rental Risk Units

20,000

25,000

30,000

35,000

40,000

45,000

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2007 2008 2009 2010

Source: Manheim Consulting

6

Average Auction Price – Rental Risk Units

$8,500$9,000$9,500

$10,000$10,500$11,000$11,500$12,000$12,500$13,000$13,500

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

2007 2008 2009 2010

Source: Manheim Consulting

7

Leasing:Growth in Originations & Satisfaction

Source: Manheim Consulting

3.43.7

3.5

2.72.5

2.1 2.12.5

2.7 2.7

2.0

1.1

1.7

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

1998 2000 2002 2004 2006 2008 2010

Lease Originations - Millions of Units

8

Lease Penetration Ratesby Manufacturer

2008 2009 2010

Chrysler 17.0% 2.9% 9.2%

Ford 15.1% 5.5% 9.8%

GM 11.1% 2.1% 8.8%

Honda 19.4% 18.7% 28.7%

Toyota 15.8% 15.6% 24.5%

Hyundai 2.4% 2.2% 12.3%

BMW 51.0% 51.3% 48.6%

Mercedes-Benz 49.2% 46.6% 51.7%

Total Industry 17.9% 13.1% 19.1%

Source: J.D. Power and Associates

9

Off-Lease Volumes – Another Down Cycle Ahead

1.0

1.5

2.0

2.5

3.0

3.5

4.0

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

E20

11E20

12E20

13E20

14E20

15E

mill

ions

of u

nits

Source: Manheim Consulting

10

Repossessions:Lower Volumes & Older Units

0.0

0.2

0.40.6

0.8

1.0

1.2

1.4

1.61.8

2.0

2.2

1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Source: Manheim Consulting

Number of Repossessions - Millions of Units

11

Commercial and Government Fleets:Higher Volumes & Strong Prices

0

200

400

600

800

1,000

1,200

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 e

Thou

sand

s

Commercial Government

Source: Bobit Business Media

New Vehicle Sales into Commercial and Government Fleets

12

$4,000

$5,000

$6,000

$7,000

$8,000

$9,000

$10,000

Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11

Unadjusted Mileage & Seasonally Adjusted

Source: Manheim Consulting

Average Auction Price –Midsize Fleet Cars

13

1

2

3

4

5

6

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Mill

ions

Source: 1999-2009 NAAA Surveys, 20010-2015 Manheim Consulting estimate

Dealer Consigned Vehicles Sold at NAAA Member Auctions

Dealer Consignment:Steady Growth Ahead

14

910111213141516171819

Jan-

87

Jan-

89

Jan-

91

Jan-

93

Jan-

95

Jan-

97

Jan-

99

Jan-

01

Jan-

03

Jan-

05

Jan-

07

Jan-

09

Jan-

11

mill

ions

of u

nits

Source: Automotive News

Seasonally Adjusted Annual Rate - 3-Month Moving Average

New Car & Light-Duty Truck Sales

15

4

6

8

10

12

14

16

18

20

1960 1970 1980 1990 2000 2010

New Vehicle Sales

millions of units

Source: Automotive News

Peak-to-troughs:1973 to 1975 -24%1978 to 1982 -33%1986 to 1991 -23%2000 to 2009 -41%

New Car & Light-Duty Truck Sales

16

Used Vehicle Retail Sales

10

15

20

25

30

35

40

45

50

1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010

Mill

ions

Total Dealers

Source: CNW Marketing Research

17

Ratio of Used Vehicles Retailedto New Vehicles Retailed

1.0

1.5

2.0

2.5

3.0

3.5

4.0

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

2008

2010

Source: Automotive News & CNW Marketing Research

18

-800

-600

-400

-200

0

200

400Total Private Sector

Monthly Change In Nonfarm Payrolls3-month moving average – in thousands

Source: Bureau of Labor Statistics

19

20

95

100

105

110

115

120

125

Jan-95

Jan-96

Jan-97

Jan-98

Jan-99

Jan-00

Jan-01

Jan-02

Jan-03

Jan-04

Jan-05

Jan-06

Jan-07

Jan-08

Jan-09

Jan-10

Jan-11

Source: Manheim Consulting

January 1995 = 100

Manheim Used Vehicle Value Index

21

Outlook and Implications

New vehicle sales– A lower underlying trend

– Movements around that trend driven by labor market and credit conditions

– Manufacturers maintain inventory and pricing discipline

Retail sales and profits continue to shift in favor of used vehicles

Less supply and stable demand means strong used vehicle pricing

Economic recovery may surprise to the upside in the near-term, but we will fail to achieve previous peaks in employment, household

net worth, and new vehicle sales prior to the next recession.