Penske Automotive Group Inc. plans to expand its CarSense used-only operation by building and opening stores in three U.S. markets within 12 to 18 months.
The nation's second-largest car dealership group owns land in the Phoenix area where it intends to spend $3 million to $4 million to build a CarSense store, Chairman Roger Penske said Thursday during a conference call with analysts and reporters.
"We have a [predelivery and inspection] center there that we can utilize," Penske said.
Two other potential sites are on the company's radar. The retailer declined to give specifics, but Penske referred to New Jersey and Pennsylvania during the call. Penske said the future CarSense stores will need to be on sites of at least 10 to 15 acres to stock adequate inventory.
The timing for the stores' construction "is dependent on local zoning ordinances and approvals," Tony Pordon, executive vice president of investor relations and corporate development, wrote in an email to Automotive News. "We would expect to have new locations open within the next 12 to 18 months."
CarSense, which Penske bought early last year, has five stores around Philadelphia and Pittsburgh. Penske also bought CarShop, which has five stores in the U.K., last year.
At the time, Penske said he intended to double the number of locations for both retailers within 24 months.
In December, Penske said it was buying The Car People in the U.K., which has four large-scale retail locations. The purchase is expected to close in the first quarter.
Used-only is such a "growth opportunity" for Penske, he said, it will eventually expand to other international markets.
"There's no question that we could be looking at Germany and Spain at some point," said Penske. "But there's so much white space in the U.S. and U.K. right now," he said, that the company's focus for the next few years is to expand in markets where it has staff and stores so it can capitalize on economies of scale.
Penske, of suburban Detroit, ranks No. 2 on Automotive News' list of the top 150 dealership groups based in the U.S., with retail sales of 249,695 new vehicles in 2016.