FORT LAUDERDALE, Fla., July 24 (UPI) -- The largest U.S. auto retailer, AutoNation, said it would cut 1,300 store positions in an effort to trim costs after a slumping second quarter.

The plan includes reducing advertising and trimming the workforce by 5 percent, in an effort to save $100 million, The Miami Herald reported Thursday.

AutoNation Chief Executive Officer Mike Jackson called the second quarter of 2008 "the most challenging automotive sales environment any of us have ever encountered."

''The $100 million is primarily in changing our advertising spending and changing our compensation structure, which is the elimination of 1,300 positions at the store level,'' Jackson said during an interview on CNBC.

AutoNation's second-quarter earnings revenue fell 12.7 percent to $3.91 billion, the Herald reported. New vehicle sales for the company declined 12 percent in the quarter, the report said.