Budget Car Sales Inc., a subsidiary of the rental car company Budget Group Inc., has bought three new-car dealerships with combined revenues of $165 million last year.
The dealership purchases are Budget's first foray into ownership of franchised new-car stores. The dealerships are located in cities where Budget operates its used-car stores.
By operating new- and used-car stores in the same markets, the company hopes to realize savings by combining back-office functions, marketing and advertising expenses and management costs.
'These new additions will also create greater efficiencies in fleet purchasing, given that we already buy so many Ford products, and allow Budget Car Sales customers to access manufacturers' finance programs, resulting in cost savings and revenue opportunities for the company,' said Sandy Miller, chairman of Budget Group, in a press release.
Budget Car Sales owns about 30 used-car stores, stocking about 90 vehicles apiece.
Sales were $240 million last year based on sales of 14,000 vehicles.
The three dealerships are Paul West Ford Inc. in Gainesville, Fla.; Warren Wooten Ford Inc. in Cocoa, Fla.; and Carson Chrysler-Plymouth-Dodge-Jeep Inc. in Plain-field, Ind. They will retain their names and management teams.
In an unrelated transaction, Budget Group said it will complete later this month the acquisition of Ryder TRS Inc., a consumer truck rental firm, for $125 million in cash plus stock and other considerations. Ryder is owned by Questor Partners Fund LP in Southfield, Mich.
Ryder is the second-largest renter of trucks to consumers behind U-Haul Co.
Ryder operates a fleet of 30,000 vehicles and posted sales of $545 million in 1997.
Budget is the world's third-largest car and truck rental system, with revenues of $1.6 billion in 1997.
Budget Group has headquarters in Daytona Beach, Fla., and Budget Car Sales is based in Chicago.