(Reuters) – U.S. auto retailer Lithia Motors Inc reported a four-fold rise in its quarterly profit on Wednesday, boosted by higher vehicle prices and strong demand for personal transportation during the COVID-19 pandemic.
Low interest rates and consumers’ preference for personal vehicles have lifted demand for auto retailers at a time when supplies have been plagued by an unrelenting semiconductor crunch. This has pushed customers to pay higher prices and boosted profits for manufacturers and retailers.
The average price of a new vehicle set a first-half record of $38,041, an increase of 10% from 2020, according to consultant J.D. Power.
Average gross profit per new vehicle for Lithia jumped 58% to $4,173, while it rose 47% to $3,311 for used vehicles.
The company’s net income for the second quarter ended June 30 was $304.9 million, or $10.75 per share, compared with $77.7 million, or $3.38 per share, a year earlier.
Its revenue jumped to $6.01 billion from $2.76 billion.
(Reporting by Shreyasee Raj in Bengaluru; editing by Uttaresh.V)
