Buy/sell auto dealership activity is set to rebound to record levels in 2017, according to The Blue Sky Report from Kerrigan Advisors.
Although there was a slight decline (8 percent) in overall transaction activity in 2016, and rising real estate costs are set to present a challenge for buyers, an increase in serious sellers coming back into market, improved valuations, private buyer demand for large acquisitions and advantageous market fluctuations are driving optimism for a robust 2017.
Public auto retailers’ acquisition spending decreased 21 percent in 2016 compared to 2015, with Lithia and AutoNation the only public dealer groups to make acquisitions of U.S. dealerships in 2016.
Publics sold nearly as many dealerships as they acquired.
The private sector acquired 89 percent of the franchises sold in 2016.