AutoNation’s leader reflects on life and what’s next
Photos by Evelyn Suarez
Mike Jackson is one of the top figures in automotive history and had plenty to say about the industry’s future during SFBW’s “CEO Connect” conversation.
He expects more changes in the next 10 years than in the last hundred years, but says Americans’ love affair with their cars is far from over. Jackson shared an array of business management tips, including some from the late H. Wayne Huizenga.
Jackson led AutoNation as CEO for 20 years and, at age 70, has transitioned into the role of executive chairman. He started his career as an apprentice mechanic at a Mercedes-Benz dealership, but ultimately ran the company’s entire U.S. operations.
AutoNation is the largest retailer of vehicles having sold 12 million vehicles in its history. It had $21 billion in 2018 revenue and sold 600,000 vehicles.
Jackson was inducted into the Automotive Hall of Fame in 2018 and Fortune named him one of the top 50 Global Business Leaders.
In 2018, he served as chairman of the Federal Reserve Bank of Atlanta’s board of directors.
He is a special contributor to the CNBC, Fox and Bloomberg business news networks.
He is married to Alice Lucia-Jackson and has three children, Michael, Kristina and Lauren.
Here are highlights from the interview by SFBW Chairman and CEO Gary Press at The Tower Club in Fort Lauderdale. They have been edited for brevity and clarity.
Dancing on the head of a pin
I absolutely loved being the CEO of AutoNation and working with Wayne. It’s been incredible. But being the CEO of a publicly traded company is like dancing on the head of a pin every day. The average life expectancy is three to four to five years and then something happens and you get your head chopped off.
If you look at the CEOs of publicly traded companies in America, the longest tenured is Warren Buffett and then there’s a couple others and then there’s Mike Jackson. So, I now turn 70. I always liked round numbers. I looked in the mirror and said it sounds like a good idea for the next chapter. Not only because it’s dancing on the head of a pin. When you wake up on Jan. 1, your calendar is basically 75 percent booked. By February, you are done and off you go. I love this new chapter on mentoring our exciting new CEO and being the executive chairman.
I’ve had a very interesting life, and on the bucket list, there’s not much left. I really have done it all. The pearl of wisdom I will give you is that in the journey of life, it’s really about sharing experiences with loved ones and that’s family and your friends. That’s all it’s about.
I’m really entering a new chapter where I want flexibility in my calendar that I can do interesting shared experiences with family members and friends.
The presidential campaign and the economy
I think if the Democrats nominate somebody center-left, they have a very good chance of winning. I think if the Democrats nominate somebody far left, Donald Trump will win. I think Republicans retain the Senate. I think we can survive four years of craziness. Eight years will be a big ask.
We have 3 percent of the world’s population and 20 percent of the GDP. How can that be? Well, we have a free enterprise system that supports entrepreneurialism with laws that sort of put guardrails in place. We have had at various times policies that supported free trade. We have a Federal Reserve Bank that’s independent from the politics. Just look at what happens to countries like Venezuela, where the politicians take over the central banking system. What we’re not looking at today is being late in the cycle of economic growth and we have very low interest rates in historical terms with trillion-dollar deficits as far as the eye can see. Usually, the Republicans have been the adults in the room when it comes to fiscal responsibility. They’re nowhere to be seen.
I look at the demographic challenge of the workaholic baby boomer generation finally moving into this next chapter like me. We have an expectation around financial support from Social Security and health care that the younger generations will have to pay for. The numbers do not work—a massive deficit, massive debt with this legacy entitlement is going to in a five- to 10-year horizon create an epic collision. We’ve had these moments before in our history and America is a very innovative, creative, resilient country, but I think it’s reckless, under today’s circumstances to be running trillion-dollar deficits, year after year after year.
The Federal Reserve is the most respected institution in the world, period. All the central banks in the world consult with the U.S. Federal Reserve. The independence of the Federal Reserve is paramount to our future. Just look at the deception in Washington, and just imagine if you would have the central banking system that can’t act independent of the politicians.
I was in the debates in Washington last year and my view was that tariff chaos was going to unsettle the global supply chain. These are 10-, 15-, 25-year systems that have been built up. You create tons of chaos.
I have put the point of view forward that we’re in a period where you have a White House that has a petulant 10-year-old pyromaniac that’s discovered a blowtorch. The Fed was very bullish about the economy this year and now you literally see that they’re concerned. I expect they will act before the year is over, and the White House is going to celebrate. I’m warning you: The global supply chain is disrupted and investment is backing off. People don’t know the rules of the road. People don’t know what’s going to happen next. You hunker down and get cautious. It gets a little scary.
The dumbest thing he did as a leader
I don’t do dumb. One of my secrets to success and accomplishments, is I’ve always surrounded myself with really smart people, and I run a participatory management system. Smart people around the table discuss all issues, and everybody’s expected to speak up and contribute. I like the bell curve, I like eights, nines and 10s [as part of the leadership team]. Everybody has a point of view.
Why don’t I say I did something dumb? Somebody will speak up and say, “Mike, that’s one of your particularly dumb ideas.” Another one is when they all burst out laughing spontaneously. Then I know it’s a particularly dumb idea.”
The smartest thing he’s done
Marrying Alice. That’s No. 1. No. 2 saying yes to Wayne. I have 50 years of history with Mercedes-Benz. My first car was a Mercedes-Benz. I turned my first wrenches on Mercedes-Benz. I went from literally an apprentice mechanic to being the CEO of Mercedes for the Americas. That’s pretty cool. That was my dream.
Wayne called, and I said to myself, ‘This is the most dynamic entrepreneur that I’ve ever encountered in my entire life. This is a remarkable individual. I have absolutely no idea whether he and I will get along or not, but I can tell you this is going to be magic or tragic.
I have to tell you, it was magic. It was exhilarating. Hanging with Wayne, riding with Wayne is the most exciting thing you can experience in life. We became best friends. He was my best man when Alice and I got married, and I miss him every day. [Huizenga died last year.]
Change in the automotive field
I talked about this years ago when everybody said America was up the creek without a paddle. What they were missing was the fact that a cranky, ornery Texan named George Mitchell spent $100 million dollars of his own money creating a process called fracking. Big oil didn’t do it. Saudi Arabia didn’t do it. Fracking has unleashed in America, several Saudi Arabias. America is the largest producer of energy in the world. This idea that we are going to be beholden to the Middle East for petroleum? If they play that card, you just look at them and say, “You are fracked.”
Having said all that, automobiles have to do their part. We have to move forward on reducing the output of CO2. You had a whole world trying to move the parade in the right direction over time. We have to find a way forward in automobiles, and that will be electrification. The energy is produced in centralized power plants that can control the CO2 emissions extremely well. There’s no turning back. Electrification is coming.
Will car ownership go away?
Let’s not get carried away here. One of the reasons I’m in the automobile business is, I was very independent minded as a kid. I started saving for college when I was 10 and I haven’t stopped working since. To me, the automobile always represented that unique American characteristic of independence, that we can go wherever we want. If I wake up tomorrow, look out and say, “Hey, I’d like to drive to California,” I can do it. Then you have all kinds of choices as to what purpose you use it for and as far as style, personality, character, what it says about you.
There are 3.2 trillion miles a year driven in the United States. Twenty five percent of those are what I would call shared miles, and includes buses, trains, Uber, taxis, rental cars, all that.
I think certainly, companies like Uber and Lyft are disrupting the shared-use market, but the bleedover of people giving up their automobile to go fully shared, is not really happening.
Millennials are the largest demographics and purchaser of vehicles for AutoNation. There is a difference. The difference isn’t the automobile. The difference is the smartphone. You get a smartphone, you have a level of freedom that I had when I got my car. Freedom from your parents and school. So, they get a smartphone, download the Uber app and put it on their parents’ account, and they go. What we see is ultimately, the millennial generation, live longer with the parents, live in a rental longer, buy a house later, get pregnant later, buy a car later, but ultimately they do it.
Business and career philosophy
Everything’s a calculated risk. When I was a kid I played chess. I was very good. There was another game called Risk, which involves dice and uncertainties and you had to calculate odds. I was almost unbeatable. So, you’ve got to be able to calculate the risk in any business situation, and determine what whether you can win the hand, and it has to be a very high probability to take the risk.
Whatever you decide to do, you need to be extraordinarily good at it and you have to love it. You have to be passionate. It has to be a joy to go to work. You will never be extraordinary if you don’t love what you do. I’ll give you an example. I graduated from university and I have a degree in political science. I take the LSAT [law school admissions test] and I had one of the highest scores in the country. I’m going to Georgetown in an old Mercedes that broke down. I’m sitting there thinking, “I’m not sure law is for me. It’s like, I can do it, but I don’t enjoy it.” And I said, “You know what? I’m going to take a year off and fix cars.” I’ve met people in my life who have so much invested in a given direction that they figure that out too late. They don’t love it and there’s no exit. They’re grinding it out because they have to.
Hiring and firing
I have absolutely no joy and laughter in separating anyone from being employed. Whenever I have to separate where the company has to, I look at it as a as a failure on my part. I selected this individual, because I thought they had the ability to do the job and I was wrong. How did I miss that? Or if I had a better development program or better mentoring program, they would have made it. So, it’s painful.
I’ve seen situations where somebody misbehaves, and you have to step in. So, you could feel, “I took care of that. That’s not going to happen again.” Whereas I look at it and say, “How did I miss that and that person get into the company, get that far and I missed it?”
Wayne gave me the best rule about talented people. He looks at me one day and says, “Mike, you’re going to spend a lot of time with these people. If they have big character flaws or are absolute jerks, they’re toxic to the organization. I don’t care what kind of numbers they put up in their performance, if you accept that type of negative energy in your organization it is corrupted.”
What’s next for Jackson
This is this is the remarkable thing: I’ve declared victory. I was very fortunate that I was born in America. My parents were part of the Greatest Generation. One day, my father sits me down and says, “Mike, work will define you and all your brothers and sisters. Everybody’s want to get an education and college is expensive and you need to get a job. You start saving for college.” So, I was 10 years old when I get this speech. So, I started the next day as a stable boy. I was on the farms outside Philadelphia. I got paid $1 a stall. I could say, “Woe is me,” and take all day to do one stall, or I can get my shovel in the horse shit and do 20 stalls and make $20. It was the greatest lesson in my life: Whenever you’re confronted with a challenge, get shoveling.
So, I have continuously worked since I was 10 years old. I’m declaring victory. ♦
About CEO Connect
SFBW’s CEO Connect series is an exclusive, invitation-only monthly event that brings together South Florida’s top business leaders to meet and mingle.
The gold level sponsors are Celebrity Cruises, CenterState Bank, C3 & Broward Health.
The evening begins with a cocktail reception for about 100 guests followed by the highlight of the event, a live interview conducted by Gary Press, SFBW Chairman and CEO or Clayton Idle, Associate Publisher and a well-known C-level executive who provides insight into their personal lives, careers and views on issues affecting the business community.
Partnering with SFBW on this exclusive event provides an opportunity to network with the area’s business elite, generate new business opportunities, and increase brand awareness. For information about event sponsorship opportunities, email Clayton Idle at [email protected]
Mike Wolfson and Chuck Tobin
Gustavo Hermido and Jorge de los Reyes
DK Mink and Mike Jackson
Mike Jackson is interviewed by SFBW Chairman and CEO Gary Press.
This edition of CEO Connect was held at the Tower Club in Fort Lauderdale
Attendees network before the start of CEO Connect
Marc Friendlich and Kurt Silvia