Despite a slight decline from 2022’s record highs, blue sky values—a key metric in dealership valuation—remain elevated, standing at 2.3 times above pre-pandemic levels. Industry experts suggest that these values will continue to be high, driven by sustained dealership profits and demand from dealers aiming to expand their footprint. Here’s a look at five dealer groups that recently made significant buy/sell deals.
1. LAPIS Acquires Mercedes-Benz of Northern Arizona
Houston-based LAPIS, under the leadership of Todd Blue, has expanded its automotive presence with the acquisition of Mercedes-Benz of Northern Arizona, previously known as Mercedes-Benz of Flagstaff. The purchase, finalized on December 19, 2023, includes the dealership’s real estate and automotive franchise, located at 5171 Test Drive, Flagstaff, Arizona. This marks LAPIS’s first venture into franchise automotive dealerships, a strategic move that complements its boutique classic car collection. Todd Blue, a seasoned figure in the automotive sector, aims to leverage his experience to enhance customer satisfaction and community engagement through this new acquisition.
2. Leith Automotive’s Sale to Holman
Raleigh-based Leith Automotive Group, a dominant force in North Carolina’s auto retail market, has agreed to sell its operations to a New Jersey-based auto group. The financial details of the transaction, expected to close by the end of March, remain undisclosed. This acquisition comes at a time when Leith has diversified its offerings, including becoming one of the first U.S. dealers for VinFast, a Vietnamese electronic vehicle manufacturer. Despite the change in ownership, the Leith brand will continue, and current employees will be retained, ensuring the preservation of its longstanding market presence and employee relations.
3. Penske Automotive Group Expands to Nantucket with Don Allen Auto Acquisition
In a strategic move, Penske Automotive Group, Inc., led by billionaire Roger Penske, has purchased Don Allen Auto Service Inc. for $12.34 million. This acquisition not only expands Penske Automotive Group but also marks its first dealership in Massachusetts. Don Allen Auto Service, the only car dealership in Nantucket, has been a family-run business since the 1960s. Don Allen Auto Service Inc., owns four properties along Polpis Road totaling just under four acres. The sale includes Don Allen Chrysler-Dodge-Jeep-Ram, Don Allen Ford, and an auto service garage at 24 Polpis Road, with current owner Bill Tornovish, Jr. announcing his retirement as part of the transition.
4. McGovern Automotive’s Expansion Continues with New Hyundai Dealership in Milford
McGovern Automotive Group, based in Newton, MA, has announced the opening of McGovern Hyundai of Milford. This follows the acquisition of Imperial Hyundai, contributing to McGovern’s significant growth trajectory. Since its inception in 2016, McGovern Automotive has rapidly expanded, now operating 29 dealerships and employing over 1,600 people. The company’s aggressive acquisition strategy has been a key driver of its growth, with 2023 revenues reaching $2.2 billion.
5. Feldman Automotive Group Enters Indiana Market with Latest Acquisition
Feldman Automotive Group, headquartered in New Hudson, Michigan, has acquired All American Chevrolet Cadillac in Muncie, Indiana, from Monte Perkins. This acquisition represents Feldman’s first dealership in Indiana, expanding its portfolio beyond Michigan and Ohio. The dealership, located off Interstate 69 at 6580 W. Hometown Blvd., will continue to operate under its established name, maintaining its local brand identity.
