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March 28.2026
3 Minutes Read

Exploring the 2025 Dealership Buy/Sell Market: Record Transactions and Future Trends

Modern car dealership showcasing luxury cars through glass windows, 2025 dealership buy/sell market.

The Dealership Buy/Sell Market Surges in 2025

In an unexpected turn amid a year filled with challenges for auto retailers, the dealership buy/sell market reached new heights in 2025. A mix of strategic acquisitions and strong financial health has paved the way for impressive growth, raising essential questions about the future of auto retail.

Unprecedented Transaction Levels Fuel Optimism

The 2025 Blue Sky Report® by Kerrigan Advisors revealed that an all-time high of 458 transactions took place across the United States in the past year. This figure translates to the sale of 688 franchises, marking a 5% increase from the previous year. What does this mean for the industry? The surge signals not only a robust appetite for acquisition but also a shift toward consolidation in the rapidly evolving automotive landscape.

Market Mechanics: Strategic and Selective Purchases

Analyzing the momentum, it's clear that public dealerships are leading the charge. In 2025 alone, nearly half of their capital, amounting to about $4.4 billion, was dedicated to acquiring dealerships. However, the nature of these acquisitions has transformed. The average number of franchises sold per transaction dipped to an unprecedented 1.5, highlighting a strategic shift from broad-based opportunistic buying to focused expansions in markets where acquirers already operate.

Erin Kerrigan, the Founder and Managing Director of Kerrigan Advisors, stated, “While buy/sell activity was strong, the valuation environment is increasingly bifurcated. High-performing franchises are commanding price premiums, while those that are lower-performing or smaller face more limited interest.” This trend reinforces the notion that selectivity is driving future market transactions, with consolidators prioritizing geographic density and large-volume dealerships.

Financial Performance: The Underlying Strength

Significantly, sustained profitability underpins this aggressive market behavior. Despite challenges such as diminishing pandemic-era margins, the average pre-tax earnings for public dealerships stood steady at about $4.1 million per location, reflecting a robust 3.6% net-to-sales margin. These figures are an impressive 87% above the pre-pandemic averages, engendering confidence among buyers that these earnings benchmarks won't merely serve as temporary peaks but rather sustainable floors.

New Vehicle Sales: A Positive Ascendance

The data reveals further optimism; retail light vehicle sales climbed to 14.5 million units in 2025, eclipsing 2019 figures and generating total industry revenue at new all-time highs. The average gross profit per new vehicle also showcased a significant rise, with a normalized average of $3,383—63% higher than 2019 levels. This performance illustrates a dynamic recovery in the new vehicle sector, lending more credibility to the valuation environment within the overall auto market.

Shifting Dynamics with Fixed Operations

Beyond the sales floor, the significance of fixed operations cannot go understated. As vehicle service lanes and used inventory stabilize earnings, dealers are being sustained by a growing reliance on them. The average gross profit from fixed operations surpassed $5 million per dealership in 2025, driven partly by an aging vehicle fleet in the U.S. and rising consumer demand for vehicle maintenance.

Looking Ahead: Opportunities and Digital Disruption

The findings from the Kerrigan Blue Sky Index indicate a closing average of 176, 76% above levels from 2019. Some brands—like Honda—have seen notable multiple increases, affirming their desirability in the current market. However, notable competitors such as Carvana are introducing significant disruption through technology-driven acquisition and lower operational costs, thus challenging traditional dealer operating benchmarks.

As we navigate through 2026, it’s vital for dealership owners to position themselves strategically not just to weather potential storm clouds but to capitalize on emerging trends as they redefine the automotive retail landscape. The future is increasingly shaped by technology and strategic foresight as dealers look to blend traditional strengths with new operational efficiencies.

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03.27.2026

Why Bridging the Online-to-Offline Car Buying Experience Matters

Update Reimagining Car Buying: The Shift to a Unified Experience The modern car buying journey has transformed dramatically, moving away from the traditional linear path towards a fluid experience that intertwines online and offline interactions. This means that today’s customers conduct extensive research across websites, videos, and social platforms before they even set foot in a dealership. The accessibility of information has empowered buyers to make informed decisions, thus elevating their expectations for seamless transitions from digital exploration to in-person purchasing. One Journey, Not Two: The Importance of Integration Given that the majority of car buyers engage digitally first, dealerships cannot afford to treat online inquiries and in-store visits as separate experiences. An integrated purchasing process is critical. When dealerships operate in silos—where customers have to repeat their information or rehash their interests—it not only annoys customers but also increases the risk of losing potential sales. To combat this, leveraging data-driven insights and adopting AI technologies will ensure that the customer's intent is understood and followed through, creating a more cohesive interaction. The Cost of a Disconnected Experience Disconnects in the car purchasing journey can have severe repercussions beyond immediate sales losses. When customers feel that their online interactions do not translate to a positive in-person experience, trust diminishes. Follow-ups can become generic and irrelevant when crucial customer preferences aren't carried over from the digital to the physical realm. In essence, when the customer journey resets post-sale, dealerships compromise the potential for future business, pushing clients to seek alternatives where their preferences are better acknowledged. Building Trust Through Transparency Transparency in pricing and vehicle information is not merely a promise but rather a practice that dealerships must integrate into their customer experience. Customers are likely to engage more positively when they find consistent and clear communication across all channels—be it online or in-store. When gaps occur—such as differing information about vehicle availability or pricing—it can lead to customer frustrations and skepticism. By establishing a transparent system that maintains consistent messaging throughout the buying process, dealerships can enhance their reputation and strengthen relationships with buyers. Innovative Technologies Driving Change To effectively bridge the gap between online and offline experiences, dealerships must invest in modern technologies such as customer data platforms (CDPs) that consolidate insights on customer interactions across various channels. This technology allows sales staff to personalize engagements based on tracked behaviors and preferences, ensuring each touchpoint adds value. AI can play a significant role here, analyzing data to generate timely promotions tailored to individual shopper journeys. This potential for hyper-personalization enhances customer confidence and encourages loyalty, essential for a successful dealership. Adapting to Customer Expectations Today’s car buyers expect a retail-grade digital experience that mirrors the fluidity of their interactions with leading tech companies. A significant percentage of consumers desire a shopping experience that feels integrated and tailored to them—91% of buyers prefer personalization during the buying journey. Dealerships must adapt by adopting technology that not only streamlines purchasing processes but also aligns with customers’ contemporary shopping behaviors. Actionable Steps for Dealerships To ensure a successful transformation towards a connected customer experience, dealerships should consider implementing the following strategies: Audit current systems: Evaluate existing online and offline platforms to identify gaps in information sharing and customer data transfer. Invest in technology: Utilize tools like AI-driven customer data platforms to unify customer interactions and streamline communication. Train staff: Equip sales staff with the ability to access comprehensive customer profiles, ensuring they can provide an informed experience based on previous online engagements. By addressing these areas, dealerships can create a more cohesive and satisfying buying journey. Customers who experience a seamless transition between online research and in-store visits will likely become repeat buyers and refer others, boosting dealership reputation and sales. Conclusion Adapting to the modern car buyer's expectations is no longer optional but necessary for dealerships aiming to thrive in a digital-first world. Bridging the online-to-offline experience not only enhances customer satisfaction but also strengthens loyalty in a competitive marketplace. Embracing technology will allow dealerships to deliver personalized, integrated experiences that meet and exceed the expectations of today’s car buyers. Are you ready to enhance your dealership's buying journey? Consider integrating advanced technologies and training to create a seamless customer experience and stand out from the competition.

03.27.2026

Rob McGee Expands Automotive Footprint with Lexus of Warwick Acquisition

Update Rob McGee's Expansion into the Automotive Market In a significant move for the automotive industry, Rob McGee of the McGee Automotive Family has officially acquired Lexus of Warwick in Rhode Island. This acquisition not only adds a notable brand to McGee's portfolio—now boasting 14 dealerships across five states—but also signifies McGee's continuing commitment to building a competitive presence in the automotive market. The Role of Pinnacle Mergers & Acquisitions The sale was facilitated by Pinnacle Mergers & Acquisitions, a prominent brokerage group known for its extensive experience in the dealership landscape. With over 850 transactions exceeding $40 billion, Pinnacle has crafted a reputation for smoothly orchestrating deals between buyers and sellers. Rob McGee expressed gratitude toward Pinnacle and the Penske Automotive Group (PAG), emphasizing how pivotal they were in navigating this transition. A Bright Future for Lexus of Warwick Lexus of Warwick will continue to operate under its established name following the acquisition. This continuity is essential not only for preserving brand loyalty among existing customers but also for enhancing service offerings under the McGee Automotive Family umbrella. McGee's respectful relationship with Toyota products positions him uniquely as a prime ambassador for the Lexus brand, potentially driving customer engagement and satisfaction. The Impact of Industry Relationships Roger Penske, CEO of Penske Automotive Group, remarked on the fluency of the transaction. Good relationships empower smooth negotiations, as evidenced by Penske's ongoing association with Pinnacle. Their past collaborations have proven beneficial, ensuring an understanding of market trends and consumer behavior—essential for securing successful outcomes in dealership sales. What This Means for Automotive Dealership Competitiveness This acquisition coincides with broader industry trends, particularly in light of changing consumer financing behaviors for used vehicles. With rising used car loan interest rates and fluctuating financing options, dealerships must adapt to remain competitive. The McGee Automotive Family's expansion into Rhode Island is a strategic step that may position them advantageously amidst shifting economic dynamics. Navigating Financing Challenges As the landscape of used vehicle financing continues to evolve, understanding the best used car financing rates becomes crucial for consumers and dealerships alike. With average interest rates for used car loans increasing, dealerships must now navigate customer anxieties regarding financing. Knowing how to calculate auto loan interest and understanding available financing options will empower consumers, ultimately impacting dealership sales performance. Conclusion and Next Steps The acquisition of Lexus of Warwick by the McGee Automotive Family illustrates not only an expansion of business relevant for the local automotive landscape but also speaks volumes about the strategic partnerships necessary for contemporary dealership operations. It presents an opportunity for dealerships to engage with new customers amid the evolving economic climate. For those currently evaluating options for purchasing a used car, exploring competitive financing rates or utilizing a used car loan calculator may provide significant advantages.

03.26.2026

Discover How myKaarma's Subaru Certification Enhances Service Scheduling Efficiency

Update myKaarma Receives Subaru Certification: A Game Changer for Dealerships In a significant step toward enhancing dealership operations, myKaarma has announced its certification from Subaru of America, Inc. for its innovative service scheduling platform, Scheduler+. This recognition empowers Subaru retailers to utilize a state-of-the-art appointment management solution designed to improve efficiency, consistency, and customer satisfaction. Revolutionizing the Service Experience for Dealerships As the automotive industry rapidly evolves, enhanced operational effectiveness has become non-negotiable for auto dealers. The Scheduler+ platform leverages myKaarma's robust technology to streamline appointment workflows, ensuring that both retailers and customers can benefit from improved service experiences. Ujj Nath, CEO of myKaarma, emphasizes the platform's role in promoting communication clarity and scheduling accuracy, which are critical to boosting customer trust. Why the Certification Matters: A Broader Perspective Subaru's commitment to integrating advanced technology solutions within its retailer network exemplifies a larger trend in the automotive space. With the complexity of modern service expectations, having a streamlined approach to scheduling appointments not only increases operational throughput but also cultivates customer loyalty. dealers often struggle with matching service schedules with technician availability. Scheduler+ tackles this by centralizing scheduling across various communication channels, including voice, text, and email, thus reducing friction and improving the overall booking experience. Empowering Subaru Retailers Through Advanced Integration The certification means Subaru retailers can expect enhanced compatibility and integration with existing dealership systems. This seamless data flow is designed to improve appointment management substantially, making it easier for service departments to generate and maintain higher service demand. As Elaine Finocchiaro, Digital Service Technology Manager at Subaru of America, states, technology certification ensures that retailers have access to tools that support exceptional operational performance while adhering to established standards. Anticipating Future Trends in Automotive Service Technology Looking ahead, the adoption of solutions like Scheduler+ is expected to influence how auto dealerships interact with customers. Future innovations may include AI-driven predictive analytics to forecast service needs and innovative customer engagement strategies that can drive service department profitability. Make Your Dealership Stand Out For dealership principals, GMs, and Fixed Ops Directors, understanding and implementing platforms like Scheduler+ could be the key differentiator in a competitive market. It aligns with the broader trend towards digitization and operational efficiency, helping to manage the evolving landscape of customer expectations regarding service experience.

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