Sonic Auto Buys More Dealerships

CHARLOTTE, N.C., Oct. 16 -- Sonic Automotive, Inc. announced today that it has purchased or entered into agreements to purchase four dealerships. The dealerships have combined revenues of approximately $375 million annually. Three of the four acquisitions, representing approximately $325 million in annual revenue have closed. The remaining acquisition is expected to close before the end of the fourth quarter. Funding for these acquisitions will be provided by cash from operations.

Dealership Acquisitions The dealerships acquired or to be acquired are:

* Steve Bailey Honda in Oklahoma City, Oklahoma, * Boyd Chevrolet in Oklahoma City, Oklahoma, * Lawrence Marshall Chevrolet in Jersey Village (greater Houston), Texas, and * Coast Cadillac in Long Beach, California.

With the addition of Steve Bailey Honda and Boyd Chevrolet, Sonic is establishing a new market in Oklahoma City. Oklahoma City is the type of market where Sonic has been able to successfully expand from its initial acquisitions to develop market share and exploit locally available economies of scale. The Lawrence Marshall Chevrolet dealership complements Sonic's existing Houston area operation which includes four Ford dealerships, two Chevrolet dealerships, two Toyota dealerships, one Chrysler-Jeep dealership, one Volvo dealership and one Nissan dealership representing approximately $1 billion in annual revenues. Lawrence Marshall Chevrolet is one of the largest sales volume Chevrolet dealerships in the United States located in a rapidly growing section of the Houston market and in a brand new, state-of-the-art facility. Sonic is adding to its strong light truck brand representation in a local market dominated by truck sales. Coast Cadillac adds additional brand diversity to Sonic's import brand dominated Los Angeles operations. Sonic will now represent BMW, Honda (2), Toyota, Volvo, Chrysler-Jeep and Cadillac in Los Angeles, the second largest car sales market in the United States. B. Scott Smith, the Company's President and Chief Operating Officer stated, "This group of acquisitions exemplifies our 'hub and spoke' acquisition strategy. We are building market share and brand diversity in markets where we are already established. We're entering new markets with the strongest brands in the local market. Our strategy maximizes the potential economies of scale from consolidation in automotive retailing, enabling us to reduce the cost of locally purchased advertising and local management oversight."

Impact on Earnings "These acquisitions are expected to add significantly to the Company's earnings. However, in light of declining industry analyst forecasts for 2002 new vehicle unit sales volume, the Company is only adjusting its calendar year 2002 earnings targets to $2.18 to $2.25 per share from $2.15 to $2.20 per share. Our revised targets are based on retail sales rates consistent with reported industry unit sales volume levels of 14.5 million annually, or greater, and current interest rate levels on the Company's floorplan and acquisition borrowings. We expect to be able to achieve our targets even in a considerably slower sales environment than 2001 because of the positive impact of the announced acquisitions, benefits from cash flows from operations and much lower interest rates on the Company's variable rate debt," stated O. Bruton Smith, Chairman and Chief Executive Officer. Current sales rates are considerably higher than 14.5 million annually. The Seasonally Adjusted Annual Rate (SAAR) reported for September was over 15.5 million units and current forecasts for October 2001 are higher than September 2001 -- in some cases higher than October 2000. Aggressive manufacturers provided incentive programs such as 0.0% financing continue to aid in stimulating high levels of consumer demand. The Company's guidance is intended to be consistent with many of the more conservative industry forecasts for 2002, not necessarily current sales rates or our own forecast for industry volume. In addition, the reported SAAR for the near term may not be an accurate indication of actual retail sales volume. Substantial declines in fleet sales to daily rental car companies are expected as a direct response to declines in air travel since September 11. Because of this issue, analysis of Sonic's expected performance based on the reported SAAR may be difficult until rental fleet unit sales stabilize.

About Sonic Automotive, Inc. Sonic Automotive, Inc., a Fortune 300 company and member of the Russell 2000 Index, is the second largest automotive retailer in the United States operating 168 franchises and 32 collision repair centers in Alabama, California, Florida, Georgia, Maryland, Nevada, North Carolina, Ohio, Oklahoma, South Carolina, Tennessee, Texas and Virginia. Sonic Automotive can be reached on the Web at http://www.sonicautomotive.com .