LMP Automotive, a publicly traded used-car and vehicle subscription company, describes its business model as “Buy, Subscribe, Sell and Repeat.” That is exactly what they are ambitiously doing, with a goal to add as many as 100 dealerships by the end of 2022. On today’s show, we’re pleased to welcome the CEO of LMP Automotive, Sam Tawfik, to discuss their latest acquisitions and the future of the company.
Tawfik is an entrepreneur with a background in the technology industry. He has helped build several companies from the ground up, and has experience merging and consolidating companies. Tawfik said the retail automotive industry was attractive because of the cash flow and the need for new technologies.
The LMP Automotive subscription has become less of a focus as the company continues to turn its focus to opening new dealerships. Tawfik says this transition has occurred primarily based on the return on investment from acquiring dealerships. Despite making this pivot, Tawfik confirms that subscriptions are still performing well.
Tawfik then talks about the state of the automotive acquisition market. Pent-up demand from 2020 is creating a strong seller’s market, as many automotive dealers are looking to sell after being unable to do so for various reasons last year.
LMP Automotive’s acquisition model is to keep management in place in all the dealerships they acquire. This provides more stability for the company, and it enables them to move quickly through the acquisition process.
Tawfik concludes the conversation by looking ahead. With inventory remaining low, Tawfik foresees continued success for the industry. Dealers will continue to benefit from higher prices per unit leading to strong profits.
