The nation's largest dealership groups, both public and private, are bulking up -- adding stores and grabbing a larger share of U.S. new-car and light-truck sales.
Those are some of the conclusions to be drawn from Automotive News' list of the top 125 dealership groups based in the United States, ranked by 2013 retail unit sales of new cars and light trucks.
More than half of the top 125 groups -- 65 -- added one or more dealerships in 2013. Of those, six groups added 10 or more. In contrast, only 15 of the 125 had a net reduction in their rooftop total.
Leading the buyers was Group 1 Automotive Inc., No. 3 on this year's list, which had a net gain of 28 dealerships last year. Its acquisitions included 18 dealerships in Brazil, five in the state of Georgia, four in the United Kingdom and three in Texas.
But the buying wasn't limited to the largest groups. Indeed, 35 of the 65 groups that added dealerships in 2013 ranked below the top 50 on the list.
As they added stores, the top 125 dealership groups claimed a larger share of the U.S. new-vehicle market. Including retail and fleet sales, the top 125 groups sold 3,140,627 new cars and light trucks in 2013, or 20 percent of industry's total. Sales by the 125 groups that made up the previous year's list represented 19 percent of that year's total.
Luther Automotive Group, one of the largest privately held dealership groups in the country, joined the ranking this year for the first time. It debuted at No. 14 with new retail sales of 35,302 units in 2013.
Though the Minneapolis group is new to the list, its heritage started with founder Rudy Luther in 1952 and continues under the leadership of his son, CEO David Luther.
Mike Gallagher, the group's vice president of operations, says the group has added dealerships over the years "slowly but surely" and tends to buy stores whose previous owners had a management style similar to Luther's. That allows the group to execute its preferred strategy of employing the previous owner's management team.
"We usually add one or two a year if we can find appropriate deals at the appropriate valuation," he says. "Last year, we opened a new Hyundai store and the year before that it was Volkswagen and Fiat."
Predictably, AutoNation Inc. topped the list again with new retail sales of 292,922, up 9 percent. The group, which added seven dealerships last year, has led the ranking since 1998, when it was known as Republic Industries Inc.