Exhibit 99.1

Sonic Automotive, Inc. Reports Strong Operating Performance for the Second Quarter

CHARLOTTE, N.C. – August 2, 2006 – Sonic Automotive, Inc. (NYSE: SAH), a leader in automotive retailing, today announced that revenue for the second quarter 2006 increased $181 million or 9.8% from second quarter 2005. This was driven by strong same store sales performance (up 3.7%) and the impact of acquisitions. Sales of used vehicles were very strong, with a total revenue increase of 20.9%. Same store used vehicle revenue was up 15%.

Second quarter 2006 earnings from continuing operations were $18.6 million, or $0.42 per diluted share, compared to $28.3 million, or $0.65 per diluted share, in the prior year period. During the second quarter of 2006, the Company recorded charges of $27.6 million, or $0.27 per diluted share from continuing operations and $0.11 per diluted share from discontinued operations. As discussed on the Company’s conference call on July 19, 2006, these charges resulted primarily from the Company’s decision to exit certain facility leases and cancel various facility improvement projects. The results for the quarter ended June 30, 2006 also include $0.01 per diluted share of stock option expense related to the Company’s adoption of SFAS 123R.

Selling, general and administrative expenses as a percentage of gross profit was 78.7% for the quarter compared with 75.4% a year ago. Absent the charges noted above, it was 74.1%, an improvement of 130 basis points, and the Company’s operating margin would have been the highest since 2002.

“We continue to be excited by the results of our key operating initiatives. During the quarter, we were able to increase our same store revenue while maintaining margin.” said President and Chief Operating Officer Jeffrey C. Rachor. “In an increasingly competitive new vehicle environment, our used vehicle sales initiative and fixed operation performance continues to drive our overall profitability. All segments of our business showed strong growth and we are particularly pleased that, for the first time in the Company’s history, we exceeded a 50% gross margin in our fixed operations business. This is a testament to the strength of our brand mix and the effectiveness of our core operating strategies.”

Presentation materials for the Company’s August 2, 2006 earnings conference call can be accessed on the Company’s website at www.sonicautomotive.com by clicking on the “For Investors” tab and choosing “Webcasts & Presentations” on the left side of the screen.

About Sonic Automotive

Sonic Automotive, Inc., a Fortune 300 company based in Charlotte, N.C., is one of the largest automotive retailers in the United States operating 173 franchises and 38 collision repair centers. Sonic can be reached on the Web at www.sonicautomotive.com.

Included herein are forward-looking statements. There are many factors that affect management’s views about future events and trends of the Company’s business. These factors involve risk and uncertainties that could cause actual results or trends to differ materially from management’s view, including without limitation, economic conditions, risks associated with acquisitions and the risk factors described in the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2006. The Company does not undertake any obligation to update forward-looking information.

 

Sonic Automotive, Inc.

Results of Operations (unaudited)

(in thousands, except per share, unit data and percentage amounts)

 

     Three Months Ended     Six Months Ended  
     6/30/2006     6/30/2005     6/30/2006     6/30/2005  

Revenues

         

Retail new vehicles

    $ 1,153,155     $ 1,067,403     $ 2,172,729     $ 1,953,941  

Fleet vehicles

      96,207       90,411       181,318       169,579  

New vehicles

      1,249,362       1,157,814       2,354,047       2,123,520  

Used vehicles

      336,726       278,580       637,352       539,876  

Wholesale vehicles

      128,451       129,558       257,721       239,143  

Total vehicles

      1,714,539       1,565,952       3,249,120       2,902,539  

Parts, service and collision repair

      273,446       240,844       540,394       466,641  

Finance, insurance and other

      45,755       46,153       91,724       87,619  

Total revenues

      2,033,740       1,852,949       3,881,238       3,456,799  

Total gross profit

      307,994       279,023       600,026       530,026  

SG&A expenses

      242,537       210,429       469,996       408,672  

Depreciation

      6,870       3,622       11,637       7,025  

Operating income

      58,587       64,972       118,393       114,329  

Interest expense, floor plan

      15,610       8,777       27,742       16,167  

Interest expense, other

      11,022       11,054       22,785       21,672  

Other (expense) / income

      (1 )     12       (667 )     24  

Income from continuing operations before taxes

      31,954       45,153       67,199       76,514  

Income taxes

      13,380       16,873       26,880       28,578  

Income from continuing operations

      18,574       28,280       40,319       47,936  

Discontinued operations:

         

Loss from operations and the sale of discontinued franchises

      (10,299 )     (1,945 )     (17,827 )     (5,927 )

Income tax benefit

      3,913       669       6,778       2,107  

Loss from discontinued operations

      (6,386 )     (1,276 )     (11,049 )     (3,820 )
                                

Net income

    $ 12,188     $ 27,004     $ 29,270     $ 44,116  
                                

Diluted:

         

Weighted average common shares outstanding

      46,270       45,421       46,238       45,440  

Earnings per share from continuing operations

    $ 0.42     $ 0.65     $ 0.92     $ 1.10  

Loss per share from discontinued operations

    ($ 0.13 )   ($ 0.03 )   ($ 0.24 )   ($ 0.08 )

Earnings per share

    $ 0.29     $ 0.62     $ 0.68     $ 1.02  
                                

Gross Margin Data (Continuing Operations):

         

Retail new vehicles

      7.7 %     7.7 %     7.6 %     7.6 %

Fleet vehicles

      2.5 %     2.8 %     2.9 %     2.9 %

Total new vehicles

      7.3 %     7.3 %     7.3 %     7.2 %

Used vehicles retail

      10.4 %     10.3 %     10.6 %     10.5 %

Total vehicles retail

      8.0 %     7.9 %     8.0 %     7.9 %

Parts, service and collision repair

      50.2 %     49.6 %     49.9 %     49.5 %

Finance, insurance and other

      100.0 %     100.0 %     100.0 %     100.0 %

Overall gross margin

      15.1 %     15.1 %     15.5 %     15.3 %

SG&A Expenses (Continuing Operations):

         

Personnel

    $ 139,194     $ 124,638     $ 273,425     $ 241,217  

Advertising

      16,434       15,075       30,686       28,407  

Facility rent

      24,526       19,418       47,422       38,111  

Other

      62,383       51,298       118,463       100,937  
                                

Total

    $ 242,537     $ 210,429     $ 469,996     $ 408,672  
                                

Unit Data (Continuing Operations):

         

New retail units

      36,673       34,376       67,908       63,177  

Fleet units

      4,436       4,232       8,336       7,807  

New units

      41,109       38,608       76,244       70,984  

Used units

      17,460       15,052       33,170       29,626  

Total units retailed

      58,569       53,660       109,414       100,610  

Wholesale units

      13,582       14,425       26,593       26,536  

Average price per unit:

         

New retail vehicles

      31,444       31,051       31,995       30,928  

Fleet vehicles

      21,688       21,364       21,751       21,721  

Total new vehicles

      30,391       29,989       30,875       29,915  

Used vehicles

      19,286       18,508       19,215       18,223  

Wholesale vehicles

      9,457       8,981       9,691       9,012  

Other Data:

         

Same store revenue percentage changes:

         

New retail

      1.8 %       3.6 %  

Fleet

      4.8 %       5.4 %  

New total

      2.0 %       3.8 %  

Used

      15.0 %       11.7 %  

Parts, service and collision repair

      5.5 %       6.5 %  

Finance, insurance and other

      -2.5 %       1.7 %  
                    

Total

      3.7 %       5.1 %  
                    

 

 

Balance Sheet Data:

          
     6/30/2006     12/31/2005           

ASSETS

          

Current Assets:

          

Cash and cash equivalents

    $ 18,342     $ 7,566       

Receivables, net

      340,437       396,225       

Inventories

      1,051,815       1,016,457       

Assets held for sale

      219,358       73,837       

Construction in progress expected to be sold in

          

sale-leaseback transactions

      70,500       95,131       

Other current assets

      28,293       27,484       

Total current assets

      1,728,745       1,616,700       

Property and Equipment, Net

      174,487       148,267       

Goodwill, Net

      1,153,168       1,122,538       

Other Intangibles, Net

      80,200       88,696       

Other Assets

      58,380       49,300       
                     

TOTAL ASSETS

    $ 3,194,980     $ 3,025,501       
                     

LIABILITIES AND STOCKHOLDERS' EQUITY

          

Current Liabilities:

          

Floor plan notes payable—trade

    $ 450,602     $ 579,022       

Floor plan notes payable—non-trade

      649,370       410,296       

Trade accounts payable

      80,583       91,101       

Accrued interest

      18,687       17,378       

Other accrued liabilities

      172,172       167,060       

Liabilities associated with assets held for sale—trade

      93,334       45,953       

Liabilities associated with assets held for sale—non-trade

      57,323       6,937       

Current maturities of long-term debt

      2,727       2,747       

Total current liabilities

      1,524,798       1,320,494       

LONG-TERM DEBT

      644,863       712,311       

OTHER LONG-TERM LIABILITIES

      37,532       29,479       

DEFERRED INCOME TAXES

      131,140       132,419       

STOCKHOLDERS' EQUITY

      856,647       830,798       
                     

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

    $ 3,194,980     $ 3,025,501       
                     

Balance Sheet Ratios:

          

Current Ratio

      1.13       1.22       

Debt to Total Capital, Net of Cash

      42.3 %     46.0 %