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Group 1 Acquires Dealerships and Updates 2001 Outlook

14 December 2000

Group 1 Acquires Dealerships and Updates 2001 Outlook

               Renews Confidence in Fourth-Quarter Expectations

    HOUSTON, Dec. 14 Group 1 Automotive, Inc. , a
leading operator in the automotive retailing industry, today announced that it
has completed two acquisitions in the Atlanta market, one acquisition in the
Houston market and one acquisition in the Amarillo, Texas, market.  These
tuck-in acquisitions include two Toyota and one Ford, Mazda, Lincoln and
Mercury franchises with aggregate revenues of over $180 million.  These
acquisitions augment brands and expand services of established Group 1
operations.
    Atlanta-based Kelley Toyota has been renamed World Toyota.  Stone Mountain
Ford, Stone Mountain, Ga., and Heritage Lincoln/Mercury, Snellville, Ga., have
been renamed World Ford of Stone Mountain and World Lincoln/Mercury of
Snellville, respectively.  All three dealerships are now part of Group 1's
existing Atlanta platform.
    Houston-based Fort Bend Toyota has been added to the McCall Group
platform.  The dealership will augment the company's current Houston Toyota
operation, which is the second largest Toyota dealership in the nation.  The
new dealership has been renamed Sterling McCall Toyota of Fort Bend.
    Group 1 also announced that it has expanded its Amarillo operations by
acquiring a Mazda franchise that is operating in conjunction with Gene Messer
Ford of Amarillo, a part of the Messer Group platform. Commenting on the
tuck-in acquisitions, B.B. Hollingsworth Jr., Group 1's chairman, president
and chief executive officer, said, "These new additions will not significantly
impact 2000 results but in 2001 will augment our current platforms in these
important markets, and allow us to realize further economies of scale and
achieve additional operating leverage.

    2001 Outlook
    "We remain confident in expectations for the fourth quarter and full-year
2000," Hollingsworth said.  "Looking to 2001, our expectation is that we will
invest $10 million to $12 million of cash flow from operations in stock
repurchases and $20 million to $30 million to complete two or three tuck-in
acquisitions with aggregate revenues of $200 million to $300 million.
Additionally, we are adjusting our 2001 outlook based on lower industry-wide
new vehicle sales projections combined with falling consumer confidence.  We
also are continuing to see underperformance in some of our dealerships.  We
believe the impact of reduced new vehicle sales will be offset by increases in
our parts and service business, new dealership operations and company-wide
cost reductions.  This is expected to result in 2001 revenues and diluted
earnings per share approximating the company's 2000 results," Hollingsworth
added.