New leader brings supply-chain savvy to AutoNation

FORT LAUDERDALE, Fla. — Even after hundreds of candidates raised their hands to be AutoNation Inc.'s next leader, Mike Jackson believed identifying a contender with the perfect skill set would be like finding a needle in a haystack.

So the largest U.S. dealership group began looking beyond those who had applied. And with the aid of a headhunter, outgoing CEO Jackson found what he was looking for in an auto industry unknown by the name of Carl Liebert.

After reviewing Liebert's resume — highlighted by work at corporate giants Home Depot, Circuit City, General Electric and financial services company USAA — Jackson called Liebert at 5 a.m. on Saturday, Feb. 2.

That two-hour phone call led to a visit by Jackson and his wife, Alice, to Liebert's San Antonio home a few days later.

A 3½-hour dinner conversation — over halibut and bread pudding, prepared by Liebert's wife, Amy — confirmed Jackson's instincts. Jackson and Liebert have talked daily since. And on Friday, Feb. 22, AutoNation named Liebert, 53, to succeed Jackson, 70, who has been the face of the dealership group and the retail auto industry's most-vocal champion for 20 years.

He saw Liebert's supply-chain savvy and digital know-how as part of a skill set that Jackson himself was missing as he plotted ways to enhance a recently launched brand-extension strategy and innovate for the future. For the past five years, Liebert has been COO of USAA, which serves nearly 13 million U.S. military members and their families.

"Everybody can do retail small," Jackson told Automotive News with Liebert at his side in an interview near his Fort Lauderdale headquarters. "Retail at scale is a unique ability to understand what it takes to please customers one at a time, and at the same time. To do it for literally millions is a special skill. And Carl has that," said Jackson, who will become executive chairman on March 11, the day Liebert joins as board member, president and CEO.

Liebert's knack for supply-chain logistics and digital platforms made him a clear pick, said Jackson.

"Logistic distribution is not a core skill set that existed in AutoNation, and to have someone who's done it on the scale of a Home Depot joining us, that's world class," he said.

Liebert also built a digital membership platform for USAA members. Supply-chain logistics and a grasp of data and digital capabilities are rare to find in one person, Jackson said. "It's sort of a left brain-right brain thing. If you can do supply-chain logistics, you might not be able to do a digital platform."

Jackson compared his stance on the transition to AutoNation founder Wayne Huizenga's when Huizenga appointed Jackson to lead the company in 1999. "Both Wayne and I understood that I could never create what Wayne created from nothing. He did it. I could never have done it," Jackson said.

Huizenga said, " 'Mike, I created this. Now you make it hum.' " Then, Jackson took the company to scale.

"And now I'm saying 20 years later, to Carl, now we have scale, brand, purpose, and we've identified these opportunities; I don't have the skill set to go make those happen. But you do."

Still, Liebert has big shoes to fill. Jackson has long been a prominent voice in the industry, speaking on behalf of the dealer community on issues such as automakers' stair-step incentive programs, overproduction and narrowing new-vehicle margins.

Liebert described his management style as collaborative and emphasized that he's a learner first. AutoNation has 26,000 employees and about 250 new-vehicle rooftops nationwide. "The only way we're going to be successful is to unleash 26,000 associates to get after this," he said. "Being a part of a team, that's what makes organizations successful."

As the auto retail landscape evolves over the next decade, AutoNation needs to make its bets today. AutoNation must also be seen as a partner to automakers, and plan alongside them, Liebert said.

Planning includes innovation, he said, but most of all, it requires efficient execution.

"Innovation is rewarded, but execution is just worshipped. And I think this execution conversation is the reason that brands like USAA and Home Depot — that's how … legends are developed and formed," he said.

In late 2017, Jackson completed a five-year revamp of AutoNation's strategy with its brand-extension initiative, designed to keep the company profitable amid tightening new-vehicle margins. Those extensions include AutoNation auctions, standalone used-vehicle stores and collision centers, as well as branded finance-and-insurance products, parts and accessories.

"That opportunity to create a common thread of brand ... is incredibly exciting," said Liebert. But his task will be to ensure that "the plumbing underneath all that is seamless," he said.

Even as AutoNation imports its branded parts from Taiwan to distribute to the stores, for example, dealership managers shouldn't think about the supply chain or the digital experience. Those components should quietly and efficiently run in the background.

Digital obstacles

Jackson called Liebert "relentless" on execution, which will pave the way for success with the brand extension. Implementing a digital platform will be his challenge.

"This is a big idea with a big payoff," said Jackson. "That's a humongous challenge that has humbled many who have come before and have said they're going to do it. The expertise to bring it to life — Carl has it."

Liebert says he's up for it, and AutoNation already has data to leverage.

The company seeks to use that data and digital investments "to make [customers'] lives easier and allow them to ... take effort out of the things that they don't want to spend effort on."

Two decades ago, when Jackson became CEO, Huizenga was chairman. As Huizenga did for Jackson then, Jackson will step aside to let Liebert guide AutoNation.

"I'm handing him the baton. He's moving into my office, taking over my conference room. I'm giving him my parking spot," Jackson said. "It's very clear — he's the CEO of the company. However, I think I am a resource or an asset that is of value."

When Jackson walked into Liebert's house for dinner, he spotted a wall full of dragster model cars. And later, Liebert revealed 10,000 Hot Wheels cars lined up in the attic.

Jackson doesn't have to teach Liebert, the son of a drag racer, a love for cars, but he will be a resource on the industry's quirks. "Automotive retail is a unique, idiosyncratic, upside-down, counterintuitive business," Jackson said.

Liebert will count on Jackson's mentorship, especially as he meets automaker executives.

"This is where Mike built relationships that are invaluable to AutoNation. When I can leverage all of that experience that he brings to the table, [I want] to go do that because I know I'm going to skin my knees. It naturally happens when you move into a new industry," he said. "What I want to make sure of is I'm leveraging everything that he's learned over his career so that maybe those skins can heal a lot faster or prevent those from happening."

The bridge is Liebert's on March 11, said Jackson. There can't be two captains of a ship. Jackson told Liebert, "You're in charge."