Consolidation is shaking up Automotive News' ranking of the largest dealership groups.
After staying fairly stable for several years, the top 10 spots underwent several changes in the latest list, and 2015 promises more turmoil.
Dealership consolidation picked up in 2014, a year many buy-sell advisers say was the busiest in memory. That fact is amply illustrated in Automotive News' ranking of U.S.-headquartered dealership groups based on 2014 new-vehicle retail sales. The list expands this year to 150 from 125.
Take Van Tuyl Group, which edged past Sonic Automotive Inc. to No. 4 on the list.
Van Tuyl's new-vehicle retail sales of 139,538 topped Sonic's total by just 3,606, as Van Tuyl raised its dealership count to 78 at year end from 75 a year earlier. Sonic's store count held at 102.
But for Van Tuyl, 2014 wasn't about buying stores; it was the year the group was bought by Warren Buffett. And Buffett has said that the newly named Berkshire Hathaway Automotive intends to buy more stores -- a lot more.
"If we can buy dealerships at sensible prices," Buffett said in a letter to shareholders in Berkshire Hathaway Inc.'s annual report, "we will build a business that before long will be multiples the size of Van Tuyl's $9 billion of sales."
While the industry watches to see whether Berkshire Hathaway Automotive can climb in next year's rankings, Lithia Motors Inc. almost surely will.
In true photo-finish style, just 368 vehicles separate No. 7 Asbury Automotive Group, with new-vehicle retail sales of 91,560, and No. 8 Lithia, with 91,192, on the list.
But the next annual ranking could be quite different. Lithia is almost certain to pass Asbury and perhaps even displace Hendrick Automotive Group, which has held on to sixth place for four years. In 2014, Hendrick's new-vehicle retail sales totaled 106,682.
Lithia's purchase of DCH Auto Group, which closed Oct. 1, added 27 dealerships to its fold, helping push the group's total to 129 at year end. That is 43 rooftops more than Asbury had at the end of the year and 34 more than Hendrick.
In part because it included fourth-quarter sales at DCH dealerships in its full-year sales tally, Lithia's new-vehicle retail sales jumped 36 percent in 2014. In 2013, Lithia's tally of 67,177 was well behind Asbury's 86,685.
Though Lithia has not disclosed how many new-vehicle retail sales the DCH stores added to its fourth-quarter tally, Lithia's sales for the last three months of 2014 leaped 89 percent to 32,064, according to its quarterly results.
Fourth-quarter retail sales of new vehicles at stores open or owned by Lithia for one year, which did not include the DCH stores, increased 9 percent to 18,510 in the quarter. Lithia acquired 35 stores and opened one franchise in 2014, the company's documents said.
Lithia CEO Bryan DeBoer said the company still is seeking to acquire dealerships that fit its culture and business plans. The company has its sights on markets in states such as Kansas, Iowa, North Dakota, South Dakota, Oklahoma, Texas and Louisiana, he said.
"Size matters to us because it fulfills our promise to our team members that there are opportunities for them to grow," he said. "As we attract outside talent, [an initiative] which has been fairly successful, acquisitions allow us to further people's careers at a faster rate."
In another horse race, Ken Garff Automotive Group moved up to No. 10, with 57,932 new retail sales, 1,750 more than Larry H. Miller Group of Cos., which dropped to No. 11.