Strong franchise valuations, rising industry uncertainty and growing confidence in AI-driven profitability are fueling another wave of dealership acquisitions in 2026.
The dealership buy-sell market accelerated sharply in the first quarter of 2026, extending an unprecedented run of consolidation across automotive retail.
According to Kerrigan Advisors’ First Quarter 2026 Blue Sky Report, dealership transactions increased 21% year over year, while completed buy-sell transactions reached a record 478 on a trailing 12-month basis. That figure stands 114% above pre-pandemic averages and marks the sixth consecutive year of elevated consolidation activity.
A major catalyst behind the surge was a rebound in multi-dealership transactions. Kerrigan reported that multi-store acquisitions rose 36% year over year, reaching 108 transactions over the trailing 12 months. The firm’s latest OEM survey also points to continued momentum, with 35% of OEM executives expecting buy/sell activity to increase over the next year and 53% anticipating current levels to remain steady.
Notably, high franchise valuations continue to attract sellers, with the Kerrigan Blue Sky Index rising to 178 in the first quarter, a 78% increase from 2019 levels. Demand remains strongest for high-performing franchises such as Toyota, Lexus, BMW and Porsche, where valuation multiples continue to reach record territory.
Simultaneously, a growing number of dealers are reassessing long-term succession plans amid rising geopolitical uncertainty, affordability concerns, regulatory scrutiny and the potential impact of emerging competitors. Dealer confidence declined 3% during the quarter, reflecting broader concerns about tariffs, economic volatility and consumer spending trends.
Despite those headwinds, buyers remain optimistic, as public dealership groups continue to pursue acquisitions aggressively, paying nearly $200 million per dealership on average during the quarter. Many large retailers also see AI as a key growth opportunity, with 59% of OEM executives surveyed expecting AI to improve dealership profitability.
As valuations remain elevated and buyers continue to pursue scale, Kerrigan Advisors expects consolidation activity to remain robust throughout 2026.
Kerrigan Advisors is the leading sell-side advisor and thought partner to auto dealers nationwide. Since its founding in 2014, the firm has led the industry with the sale of more than 440 franchises generating more than $10 billion in client proceeds, including two of the largest transactions in auto retail history – the sale of Jim Koons Automotive Companies to Asbury Automotive Group and Leith Automotive to Holman. The firm advises the industry’s leading dealership groups, enhancing value through the lifecycle of growing, operating and, when the time is right, selling their businesses. Led by a team of veteran industry experts with backgrounds in investment banking, private equity, accounting, finance and real estate, Kerrigan Advisors is the only firm in auto retail exclusively dedicated to sell-side advisory, providing its clients the assurance of a conflict-free approach.
Kerrigan Advisors monitors conditions in the buy/sell market and publishes an in-depth analysis each quarter in The Blue Sky Report®, the industry authority on dealership buy/sell market trends and valuations and includes Kerrigan Advisors’ signature blue sky charts, multiples and analysis for each franchise in the luxury and non-luxury segments. To download a preview of the report, click here. The firm also releases The Kerrigan Index™ comprised of the seven publicly traded auto retail companies with operations focused on the US market. The Kerrigan Auto Retail Index is designed to track dealership valuation trends, while also providing key insights into factors influencing auto retail. To access The Kerrigan Index™, click here. To read the 2025 Kerrigan Dealer Survey, click here. To read the 2025 Kerrigan OEM Survey, click here. Kerrigan Advisors also is the co-author of NADA’s Guide to Buying and Selling a Dealership.
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