Then the diesel scandal broke. The dealer said he was relieved the deal did not happen after that, because he would have "overpaid for sure." He is still looking to buy stores, but he isn't interested in a VW franchise.
The VW scandal illustrates the importance of franchise diversification, Kerrigan wrote.
No one knows that better than the large private and public dealership groups.
In October, for example, Asbury CEO Craig Monaghan said that domestic franchises were appealing. In fact, Asbury's last three acquisitions have been Ford stores.
"It allows us to diversify into the truck business," said Monaghan. "Our business is very heavy car today. These are franchises that trade at a lower price point relative to many of the other stores in the marketplace."
Asbury will continue to target domestic stores in truck-heavy markets, he said.
The nation's largest auto retailer, AutoNation Inc., is buying big with domestic-brand and VW stores. So far it has closed or announced deals to buy 13 Chrysler-Dodge-Jeep-Ram stores, three Chevrolet stores, one Ford-Lincoln store, one Ford store and three VW stores. Of the $1.7 billion in added annual revenue through acquisitions announced by AutoNation this year, the majority -- $1 billion -- is from Fiat Chrysler Automobile brands.
Tommy Baker, owner of Baker Motor Co. in Charleston, S.C., said lower values for Volkswagen make his interest in buying a VW store stronger, but he's not in active negotiations on any such deal now.
"Volkswagen is going to be around," Baker said. "They're doing all the right things now to be able to correct the issue. They'll be fine. I certainly wouldn't be afraid to be a VW dealer today. Down the road, it will be a good franchise to have."