Acquisition spending on U.S. dealerships by public retailers more than doubled during the first three quarters of 2013 from the same period in 2012.
And while fourth-quarter activity might not match the pace of 2012's fourth quarter, when retailers rushed to finalize deals by year end for tax reasons, the public dealership groups still are likely to meet or top 2012's spending on U.S. dealerships for the entire year, said Alan Haig, head of automotive services for Presidio Group. Several deals by public groups were expected to close during the final three months of the year.
"The public companies are spending about the same as they did before," Haig said. "The private market seems to be a lot more active, and we're seeing that in our business as well."
Through September, public dealership groups spent $300 million on U.S. dealership acquisitions, up 117 percent from the year-earlier period, according to Presidio, a San Francisco financial services company that brokers dealership sales and tracks acquisition spending by the public groups. Including international deals, public companies' spending on dealership acquisitions rose 51 percent to $547 million.
The nation's top 10 dealership groups have eight deals that have closed or were expected to close for the fourth quarter, Haig said. Among public companies, AutoNation, Group 1, Lithia and Penske have all reported deals to close out the year.
In November, AutoNation bought Honda and Hyundai stores in Chicago with estimated annual revenue of $85 million.
"We see the opportunity to build out our footprint in our existing markets, and we're moving on that," AutoNation CEO Mike Jackson told analysts upon announcing the deal. "We're in a lot of discussions."