AutoCanada : Q1 2021 MD&A

2021

First Quarter

Management

Discussion & Analysis

MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

For the three-month period ended March 31, 2021

Table of Contents

MANAGEMENT'S DISCUSSION AND ANALYSIS

1.	Reader Advisories	3
2.	Executive Summary	4
3.	Market and Outlook	13
4.	Results of Operations	15
5.	Acquisitions, Divestitures, Relocations and Real Estate	25
6.	Liquidity and Capital Resources	26
7.	Related Party Transactions	32
8.	Outstanding Shares	32
9.	Dividends	32
10.	Free Cash Flow	33
11.	Critical Accounting Estimates and Accounting Policy Developments	33
12.	Disclosure Controls and Internal Controls Over Financial Reporting	34
13.	Risk Factors	34
14.	Forward-Looking Statements	34
15.	Non-GAAP Measures	35
16.	Non-GAAP Measure Reconciliations	36
17.	Selected Quarterly Financial Information	38
18.	Segmented Operating Results Data	40
19.	Same Stores Results Data	42
20.	IFRS 16 Impacts for the Period	44
21.	List of Dealerships	45

1. READER ADVISORIES

This Management's Discussion & Analysis ("MD&A") was prepared as of May 5, 2021, to assist readers in understanding AutoCanada Inc.'s (the "Company" or "AutoCanada") consolidated financial performance for the three-month period ended March 31, 2021, and significant trends that may affect AutoCanada's future performance. The following discussion and analysis should be read in conjunction with the unaudited condensed interim consolidated financial statements and accompanying notes (the "Interim Consolidated Financial Statements") of AutoCanada as at and for the three-month period ended March 31, 2021, the audited annual consolidated financial statements and accompanying notes (the "Consolidated Financial Statements") of AutoCanada as at and for the year ended December 31, 2020, and the MD&A for the year ended December 31, 2020. Results are reported in Canadian dollars and have been rounded to the nearest thousand dollars, unless otherwise stated.

To provide more meaningful information, this MD&A typically refers to the operating results for the three-month period ended March 31, 2021 of the Company, and compares these to the operating results of the Company for the three-month period ended March 31, 2020.

This MD&A contains forward-looking statements. Please see the section "FORWARD-LOOKING STATEMENTS" for a discussion of the risks, uncertainties and assumptions used to develop our forward-looking information. This MD&A also makes reference to certain non-GAAP measures to assist users in assessing AutoCanada's performance. Non- GAAP measures do not have any standard meaning prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures are identified and described under the section "NON-GAAP MEASURES".

Additional information regarding our Company, including our 2020 Annual Information Form, dated March 2, 2021, is available on SEDAR at www.sedar.com and our website www.autocan.ca. Such additional information is not incorporated by reference herein, unless otherwise specified, and should not be deemed to be made part of this MD&A.

AutoCanada • 2021 First Quarter Report • Page 3

2. EXECUTIVE SUMMARY Business Overview

Canadian Operations

AutoCanada's Canadian Operations segment currently operates 49 franchised dealerships in Canada, comprised of 21 brands, in 8 provinces. AutoCanada currently sells Chrysler, Dodge, Jeep, Ram, FIAT, Alfa Romeo, Chevrolet, GMC, Buick, Cadillac, Infiniti, Nissan, Hyundai, Subaru, Audi, Volkswagen, Mazda, Mercedes-Benz, BMW, MINI and Ford branded vehicles. In addition, AutoCanada's Canadian Operations segment currently operates 1 used vehicle dealership supporting the Used Digital Retail Division, and 2 stand-alone collision centres (within our group of 17 collision centres). In 2020, our Canadian dealerships sold approximately 58,000 new and used vehicles and processed approximately 654,000 service and collision repair orders in our 902 service bays.

U.S. Operations

AutoCanada's U.S. Operations segment, operating as Leader Automotive Group, currently operates 17 franchises comprised of 12 brands, in Illinois, USA. Leader Automotive Group currently sells Chevrolet, Hyundai, Kia, Subaru, Audi, Volkswagen, Mercedes-Benz, Toyota, Honda, Lincoln, Volvo and Porsche branded vehicles. In 2020, our U.S. dealerships sold approximately 7,800 new and used vehicles and processed 102,000 service and collision repair orders in our 196 service bays.

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