BLOOMFIELD HILLS, Mich. -

During the conference call held to discuss Q1 results from Penske automotive, execs touched on growth expectations for the rest of the year as well as how the Hertz Rental Car acquisition will help pre-owned business in the future.

During the question and answer period of the call, Anthony Pordon, executive vice president of investor relations and corporate development for Penske, was asked about the acquisition environment for 2013 and how aggressive the company plans to be this year.

“As we look at acquisitions, there are plenty of deals out there. I know right now, some of them are probably priced higher than we would expect,” Pordon responded. “And we have a number of transactions in our pipeline, some of those in the international marketplace which are more reasonable, and we would expect some of those to get closed in the first two quarters.”

“So, I feel comfortable with the target of 10 percent growth,” Pordon added.

Penske also gave an update on the Hertz Rental Car business and how it will tie into the company’s used dealerships. 

(Recently, the company expanded its business with Hertz, aquiring the assets and franchise rights to become the operator of Hertz rental car locations in certain markets throughout Indiana. For more information, see here.)

“The good news is that we will have somewhere between 5,000 and 6,500 cars in our fleet — ones that have been ordered with specific models and equipment which are very strong used cars that will come back in the market. Our expectation is that we will be taking these cars out and providing them to our key locations — after six, nine, 12 and sometimes 15 months, so as we try to grow this new to used ratio, we think this is a great strategy,” Pordon said.

The exec also explained that the used cars rolling out of the Hertz businesses in the future may ramp up dealership service departments, as well.

“On top of that, this gives us the opportunity for more warranty work, and also service work associated in those markets along with obviously, body work, so to me we can vertically integrate, and it gives us a chance to touch more customers on the rental side but also potentially conquesting some of those on the retail auto side.”

Interestingly, the company has also begun to see growth in these areas, in part connected to the ever-improving SAAR, as it recovers from recession lows.

Pordon also explained that pre-paid maintenance has also been a growth factor with some of the premium brand customers.

“So, we get the benefit of doing that (prepaid maintenance) for the customer, and that revenue is generated through the warranty line, so that’s why you see the warranty business up,” Pordon said. “Also, I think the quality of the vehicles obviously gets better and better and better, but this obviously gives us a chance to get more dollars.

“Also, from the standpoint of initiatives, we have gone to dentless repair, rapid repair, and most of our major locations are doing window tinting, and we are doing initiatives on alignments – these are things that we really hadn’t focused on before,” he concluded.

For a look at the numbers for Q1 Penske results, see the Auto Remarketing story here.

Sarah Rubenoff can be reached at srubenoff@autoremarketing.com. Continue the conversation with Auto Remarketing on both LinkedIn and Twitter.