Lithia Motors Inc. continued its expansion last week, buying nine dealerships in southern Florida and one in Nevada, all of which are expected to add nearly $1 billion in annual revenue to the growing auto retailer.
Lithia, the nation's No. 2 dealership group, has been on an acquisition spree and wants to grow to $50 billion in annual revenue by 2025 from $22.8 billion last year. The company is closing in on the annual revenue of AutoNation Inc., the nation's largest new-vehicle retailer, with $25.8 billion in revenue last year.
The 10 dealerships Lithia purchased last week are expected to generate $950 million in annual revenue — part of $2.1 billion in annual revenue from dealerships it has acquired so far this year.
Other potential acquisitions are in play. In April, Lithia had dealerships under contract worth $1.9 billion in annual revenue.
Tom Dobry, vice president of marketing for Lithia, said he couldn't comment on how many dealerships Lithia now has under contract to buy, nor how much in annual revenue they would generate.
He also declined to comment on the sales volume of the newly acquired stores.
But it appeared in the first quarter that Lithia may have pulled ahead of AutoNation in the number of new vehicles sold.
AutoNation said it sold 56,442 new vehicles in the U.S. in the first quarter, while Lithia reported new-vehicle sales of 64,942, including a small but undisclosed number sold in Canada.
Lithia, which bought its first stores in Florida in 2019, last week bought seven Lehman Auto World dealerships in southern Florida from Bill Lehman Jr.: Largo Honda in Florida City; Doral Hyundai-Genesis, Doral Kia and Lehman Mitsubishi in Miami; and Lehman Buick-GMC, Lehman Hyundai-Genesis and Lehman Subaru in Miami Gardens.
Bill Lehman Jr., the dealerships' principal owner, said in a statement that he had a "great run. I'm 81 and I think it's time.
"From a corporate perspective, there is continued consolidation in the automotive retail space, so when Lithia expressed interest in starting initial conversations with us, I felt that this was not only the right time but the right company."
Dobry said the Lehman dealerships are "highly regarded" and "give us an instant advantage in the market."
He also said the Lehman store names will remain, except that Lehman Subaru will be renamed.
Lithia additionally acquired Esserman International Acura and Volkswagen dealerships in Doral, Fla., from the Esserman family, said Alan Haig, president of buy-sell firm Haig Partners in Fort Lauderdale, Fla. Haig represented Lehman in the sale of his dealerships and also was involved in the Lithia-Esserman transaction.
The Florida acquisitions are expected to add $850 million in annual revenue, Lithia said.
The auto retail giant also last week bought Henderson Hyundai Superstore/Genesis of Henderson near Las Vegas from Frank Maione, according to DCG Acquisitions, a Dave Cantin Group company that handled that transaction. Dave Cantin and George Pero were the brokers.
That Hyundai-Genesis store is expected to add $100 million in annual revenue and builds on Lithia's expansion in the Las Vegas market, which it entered last year.
Maione said he had owned his Hyundai dealership for 21 years. He said Lithia made him an offer "I couldn't refuse," and he chose to sell his only dealership.
Maione said his Hyundai store at peak sold 300 new vehicles a month.
"I'm going to miss this store, and mostly I'm going to miss my employees," he told Automotive News.
In separate acquisitions this year, Lithia also bought three California dealerships in January and three Las Vegas dealerships in March. In Canada, Lithia bought a Honda dealership near Toronto in May. The retailer also has sold some dealerships this year.
Lithia, of Medford, Ore., ranks No. 2 on Automotive News' list of the top 150 dealership groups based in the U.S., retailing 260,738 new vehicles in 2021.
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July 04, 2022 at 11:00AM
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Lithia Motors barrels on with more dealership acquisitions - Automotive News
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