HOUSTON -- Group 1 Automotive Inc. has announced that the Dealer Services Group of Automatic Data Processing Inc. will become Group 1's sole dealership management system provider for its existing stores.

About 70 percent of Group 1's stores are currently operating on the ADP platform. The remaining stores, located in California, Florida, Georgia and Texas, will be converted to ADP over the next 18 months, further standardizing operational processes throughout the company's dealerships.

"After carefully reviewing our options, we determined that consolidating our providers from three to one was the right financial and operational decision for Group 1," said Earl J. Hesterberg, Group 1's president and CEO. "Converting all of Group 1's stores to the same DMS platform is another major step in our strategy to streamline our processes and leverage our scale."

Group 1 expects the consolidation of DMS providers to reduce its information technology costs by at least $3 million annually once all conversions are completed. It will also be another key enabler in supporting efforts to standardize backroom processes and share best practices across all dealerships. The company anticipates it will incur some charges for exiting contracts with other system providers, with the majority of these charges to be incurred in 2006 as each store begins the conversion process. The amount of these charges has not yet been determined.