Sonic Automotive is launching its largest brand-awareness ad campaign for EchoPark, a used-only channel that has been under the radar in many markets despite being nearly 12 years old. “We have said over and over, we are objectively the lowest price of anyone in the market. We are objectively the best customer experience for as good or better product of car. The one missing part is awareness,” said Sonic CFO Heath Byrd in a third-quarter earnings call on Oct. 29. To boost awareness, Sonic expects to spend an additional $5 million to $7 million in the fourth quarter to promote the EchoPark brand, said David Smith, chairman and CEO.
In earlier calls, Sonic officials said total spending on the EchoPark marketing campaign—which is planned to continue through 2027—would be in the range of $10 million to $20 million. Besides promoting brand awareness, the new ad campaign will also promote EchoPark’s e-commerce app and below-market pricing. Sonic is also expanding its EchoPark locations, with a new site set to open in the Orlando metro area in December. The company plans to open another two to four locations in 2027, adding to its current 18 locations. In contrast, Sonic’s franchised dealership segment has 108 locations nationwide. The lack of brand awareness has not been the only challenge facing EchoPark.
During and after the pandemic, the company struggled with a shortage of relatively affordable used cars, which are central to its business model. Late-model used-car inventory fell across the whole industry, not just at EchoPark, driving used-car prices sky-high. That’s because new-vehicle production fell, first because of auto plant shutdowns, and then because of computer-chip shortages after pandemic-related shutdowns ended.
With new-vehicle sales down, trade-ins fell, too. As a result, Sonic hit the pause button on EchoPark’s growth and cut its “hub-and-spoke” network of locations from 52 in 21 states at the end of 2022 to 18 in 10 states at the end of 2025. Sonic kept open EchoPark’s bigger “hubs,” equipped to perform reconditioning, but dropped the smaller “spoke” locations.
However, with new-car production slowly recovering, the supply of late-model used cars is increasing. This has started to translate to financial results for EchoPark, with revenues up 14% year-over-year to $596.0 million in the third quarter. Total gross profit was up 8% year-over-year to $58.9 million, and retail used vehicle sales reached 19,923 units, up 22%. Despite the positive trends, EchoPark’s total gross profit per unit in the third quarter was $2,972, down 12% year-over-year. This was due to a higher mix of battery-electric and higher-mileage vehicles, which resulted in lower sales of F&I products. David Smith noted that EchoPark’s F&I income per vehicle was also down due to this shift in sales mix.