AutoNation reportedly to cut auto orders
Citing excess inventories, dealership chain says it expects to reduce orders from Big Three by 30 percent in the fourth quarter, newspaper says.

NEW YORK ( -- The nationwide car dealer AutoNation Inc. said it expects to slash its orders from the Big Three automakers by 30 percent because of swollen inventories, according to a report published Friday.

AutoNation (Charts), considered the largest dealer chain in the United States, said the cuts in orders from General Motors (Charts), Ford Motor Co. (Charts) and DaimlerChrysler (Charts) would come in the fourth quarter, The Wall Street Journal reported.

Citing higher vehicle inventories, the company also criticized the way in which the automakers report inventory on dealer lots, saying it is misleading, the Journal reported.

The announcement, which came after the company reported a drop in third-quarter profit Thursday, fuels speculation about whether the automakers will hit their inventory targets, the paper reported.

"Either there will have to be a big sales [promotion] or more production cuts, but that's up to the manufacturers," Mike Jackson, AutoNation's chairman and chief executive officer, told the newspaper.

GM and Chrysler told the Journal they had not yet made production plans for the first quarter, while a Ford spokesman said cuts might be necessary if sales fall substantially.

All three automakers also defended their inventory reporting practices to the paper.

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