The Presidio Group’s automotive dealership valuation expertise and insights on the latest trends in mergers and acquisitions are informed, in part, by our work with many of the country’s biggest and most influential dealership groups. These relationships give us an insider’s view of how experienced and sophisticated operators value dealerships.
As 2024 begins to draw to a close, we see some distinct changes happening in the buy-sell market. The transaction environment is still strong with plenty of interested buyers and sellers, but the activity level is a bit choppier. Several factors have contributed to this, including the normalization of earnings, inflationary pressure and the uncertainty of the presidential election. Many dealers we speak with have been sitting on the sidelines until after the election. They now tell us they feel positive about the outcome and enthused about dealmaking.
Deal pace, while slightly off from year-ago levels, continues to be generally robust. Through September, Presidio estimated there were about 290 U.S. transactions involving 440 dealerships.
After evaluating deal data from the last three years, including the timing patterns of when transactions closed, Presidio estimates that full-year 2024 could produce as many as 380 transactions involving around 570 dealerships. That would put 2024 just behind transaction totals for the previous three years. While the number of dealerships changing hands would only slightly lag 2022 and 2023, it would be well behind the blockbuster year of 2021 when several megadeals pushed the number of stores sold to 707.
It’s still very much a seller’s market for dealerships representing desirable brands and in desirable locations. Brand and geography matter more than ever now, and demand for dealerships representing certain challenged brands has waned.