TO THE EDITOR:
Dealerships for sale are in limited supply, and several merger and acquisition companies have completely depleted their inventory of listed dealerships.
The reason for this phenomenon is what I term the "COVID bump," which is a result of federal stimulus dollars to taxpayers, Paycheck Protection Program money to dealers and high grosses on new and used vehicles.
Consider that the federal government sent every taxpayer making less than $99,000 a year a check for up to $1,200 per adult and $500 per child. A great deal of these federal dollars went to buy automobiles, as mass transit options were not being used. Also, most dealers applied for and received Paycheck Protection Program dollars, thereby deferring or eliminating 40 to 45 percent of the dealership expense. Finally, due to very low new and used inventory, grosses were through the roof! It was the perfect storm for most dealers — and a storm that resulted in extraordinary profits right in the middle of one of the worst economic times in modern history.
This train is now pulling into the station, and we are getting close to "business as usual."
There are limited dealerships for sale, and there is an overabundance of qualified buyers calling daily seeking deals. It's another "perfect storm," as the price of a dealership will not likely ever be higher!
ANDY GILL, President, Gill Automotive Group, St. Augustine Beach, Fla. Gill Automotive provides merger and acquisition services to franchised dealers.