Dealership buy/sells surge in first quarter

With the third quarter on the clock, dealership buy-sell activity shows no signs of slowing down.

First-quarter reports from industry experts have been dropping over the past month or so, and they confirm that activity is on the rise, even if profits and blue sky values have dipped.

Driving the news: We’ve been hearing from all advisors how busy they’ve been this year, starting with Presidio Group, which we covered in April. More recently, in its first-quarter Blue Sky Report, Kerrigan Advisors tallied 478 transactions in the trailing 12 months, the highest level they ever recorded. That figure also was 114% above the pre-pandemic five-year average.

• Haig Partners, meanwhile, in its first-quarter Haig Report, counted 139 rooftops changing hands in the first quarter, up 39% from Q1 2025.

• Multi-dealership transactions rose 54% year-over-year, according to Haig.

Between the lines: Different motivations, of course, are bringing both buyers and sellers to the market.

Both reports noted that the sellers’ club includes:

• Many retirement-age dealers ready to exit.

• Dealers facing OEM facility requirements that make owning smaller stores harder to justify.

• Groups shedding weaker or out-of-market franchises for portfolio management, a common theme we’ve heard this year.

On the buy side:

• Both firms found that dealers still have money to spend after multiple years of good earnings.

• Haig Partners described a "flight to quality" theme pushing buyers toward higher-volume, more reliable franchises.

• They also said some buyers find value in struggling franchises they believe they can turn around.

• Ninety-six percent of first-quarter buyers were private retailers, Haig’s report said, while public companies directed more capital toward stock buybacks.

Alan Haig, president of Haig Partners, said the math works out for buyers during a June 18 episode of the Car Dealership Guy Podcast.

"Let's say there's a Kia store making $3 million and you can buy it for 15 million," Haig said. "After debt service, that business is going to make you $2 million a year. I don't know that you can get that type of cash-on-cash return in other industries."

Land notes: According to Performance Brokerage Services' Q2 2026 Texas and Midwest Market Insights report, written by partner Jamie Farley, real estate can represent 40% to 70% of total transaction value.

And, property values in many markets have risen faster than dealership earnings.

Farley told CDG News via text that while dealership real estate has always been an important part of the valuation process, it plays a larger role these days.

"Buyers aren't just evaluating what the property is worth,” Farley said. “They're evaluating whether the dealership's earnings can support the investment. As property values continue to rise, that relationship is becoming an increasingly important driver of dealership valuations."

Where it’s at: Location matters, and, naturally, some areas are hotter than others.

The Southeast led the first quarter with 48 dealerships sold (35% of volume), followed by the Midwest with 39 stores (28%), according to Haig Partners.

• Haig said Florida stores draw premium values because nobody’s selling. People hang onto dealerships there for an average of 29 years, and the dealership sale rate is just 3.1 percent.

• Kerrigan Advisors noted in its valuation framework that high population growth markets like Florida, the Southeast, and Texas generally command premium blue sky multiples.

• Kerrigan’s report also pointed out that 95% of the publics' acquisitions in the last 15 months happened in places where they already owned stores.

On brand: Of course, location isn’t everything. What’s on the inside counts, too.

On that note, luxury and top import brands dominated.

Kerrigan Advisors' data shows which franchises gained the most ground in buy/sell market share comparing Q1 2026 to full-year 2025:

• BMW: +228%

• Porsche: +207%

• Lexus: +123%

• Honda: +89%

• Toyota: +37%

Kerrigan’s data also showed that luxury franchises represented 64% of public group acquisitions since January 2025.

Haig also identified opportunities at the lower end of the market, flagging Stellantis and Nissan as the top turnaround opportunities for buyers.

"I'd say those two brands are the most obvious buys for people today if you believe in the future there," Haig said on the podcast.

Bottom line: Both firms expect the pace to hold. Kerrigan Advisors' OEM survey found 88% of executives expect buy/sell activity to increase or hold for the next year.

And Haig acknowledged that even though some dealers say it’s harder to sell cars, not too many are changing careers.

"We're still in the best of times era," Haig said.