AutoNation Inc. will pluck a new CEO from outside its own ranks, giving the nation's largest new-vehicle retailer a fresh face at the top for the first time since Mike Jackson joined the company 20 years ago.
Jackson, who announced in September that he'd step down as CEO this year, told Automotive News last week that AutoNation will go with an outside candidate for his replacement.
That person will be named in the next two to three months, though the next chief executive will start at a later date, said Jackson, who will move to a new role as executive chairman once his replacement is in place. The new CEO will guide a leaner organization in the wake of a $50 million cost-cutting and restructuring plan announced last week that includes the departures of four high-level executives, including COO Lance Iserman, and the consolidation of AutoNation's three regions into two.
The reason for the restructuring is twofold: worries about tougher business conditions in 2019 and the determination that AutoNation's next CEO would not come from within.
Last week's announced departures came after "there were aspirations to be either president or CEO that were not going to be realized," said Marc Cannon, chief marketing officer. He didn't comment on who had those aspirations, though Iserman was known to be interested in the CEO job.
When the CEO search was announced, Jackson, who turns 70 next month, said his successor could be a promotion from within or an outside hire. But AutoNation's bench has thinned in recent years following a series of executive departures. Iserman, 53, had been the retailer's third operating chief since 2015.
The restructuring initiative includes job cuts beyond the executive departures, though the number hasn't yet been determined. The cuts will help AutoNation manage what it expects will be a difficult 2019 for the automotive retail business, Jackson said.
"Rising rates and rising prices are definitely a headwind, and I think it's important to be ahead of the storm, not behind it," he said.