HOUSTON — Group 1 Automotive Inc. has announced its projected 2007 outlook and full-year earnings guidance of $4.00 to $4.25 per diluted share.

For 2007, Group 1 plans to focus on three areas as it continues implementing steps to become a best-in-class automotive retailer. These areas are:

·Focusing on revenue growth, with an emphasis on increasing same-store revenue growth by 1 to 2 percent. This assumes that a slightly negative industry environment will be offset by improved customer retention and continued growth in used vehicles and parts and service.

·Completing the transition to an operating model with greater commonality of key operating processes and systems that support the extension of best practices and the leveraging of scale.

·Continued cost reduction and operating efficiency efforts. Group 1 is targeting a 100 basis-point reduction in SG&A as a percent of gross profit, to 75 percent, through the leveraging of scale, which will include benefits from the centralization of purchasing.

“Last year was a year of tremendous achievement for Group 1,” said Earl J. Hesterberg, Group 1’s president and chief executive officer. “We made solid progress in our transformation to become an operating company. I am proud of the work the team has done, which is reflected in the year-over-year 34 percent increase in earnings per diluted share through the first nine months of 2006.

“Although we made good progress in 2006, we still have substantial room for futher improvement,” said Hesterberg. “I am confident we have the team and plans in place to continue on our course of making Group 1 a best-in-class auto retailer."

Group 1 provided 2007 full-year guidance of $4.00 to $4.25 per diluted share based on its outlook and the following assumptions:

·Industry seasonally adjusted annual sales rate (SAAR) of 16.3 million vehicles.

·Flat interest rates throughout 2007.

·Tax rate of 38 percent.

·Estimated average diluted shares outstanding of 24.5 million.

·With the exception of an acquisition that is projected to close in January, guidance excludes the impact of future acquisitions, and dispositions with related exit charges estimated at $5 million to $10 million.

Group 1 also announced that it anticipates acquiring $600 million in annual revenues in 2007. The January acquisition mentioned above is included in this target; the company will announce further information after it is completed. In addition, Group 1 will continue to evaluate its dealership portfolio and dispose of underperforming stores. The company anticipates incurring approximately $5 to $10 million in associated disposition charges primarily related to sale-leaseback exit costs.