Ryan Kerrigan on how record earnings for auto retailers affects industry consolidation
On today’s edition of Inside Automotive, Ryan Kerrigan, Managing Director of Kerrigan Advisors, gives an update on the market and breaks down some of the industry’s recent headlines. Earnings are just off the charts, says Kerrigan. Quarter over quarter, the Kerrigan Index is up over 64% in aggregate for auto retailers. AutoNation and Lithia doubled earnings over Q3 in the prior year. Kerrigan says that Mike Manley and the new leadership at AutoNation are probably more focused on acquisitions and growth. Watch the complete segment here.
Ford and General Motors are in competition again over who will sell more EVs by 2025. With Tesla being the global EV leader, and Volkswagen climbing a $100 billion-plus challenge, GM and Ford are racing for third place. GM plans to form a joint venture with South Korea’s Posco Chemical. Ford plans to announce its different EV strategy, including the expansion of electric F-150 capacity in Dearborn, Michigan. Both automakers are expected to lag behind in the EV market through 2028.
General Motors’ joint venture with Posco Chemical will help build a battery cathode materials plant, processing critical materials for EV batteries. GM and other automakers are trying to find insource and onshore supply chains for EV batteries to reduce costs and lower risks of supply chain disruptions. The company plan to open a new facility in North America in 2024. No details have been released for the cost or the location of the planned facility.
Continuing with more EV news, Tesla has officially said goodbye to California and has said hello to Texas, according to a regulatory filing. The EV maker has relocated its corporate headquarters to Austin, Texas. The move comes as part of CEO Elon Musk’s ongoing breakup with the Golden State. The Gigafactory is where the Cybertruck and other vehicles are expected to be built, with aims to employ 5,000 workers.
Oklahoma dealer owners and former comptrollers, Bobby Maze, Charles Gooch, and Courtney Wells were convicted on charges of wire fraud, forgery, and exacerbation of personal information theft. Prosecutors said the dealer group used a variety of tricks from January 2014 to March 2019 at ‘big red dealerships’ to persuade lenders to issue loans to customers with low or no credit. The U.S. attorney’s office said sentencing would occur in about 90 days.
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