The 2019 auto dealership buy/sell market rocketed to a strong start in the first quarter, with 54 completed transactions, representing a 38.5 percent increase over the first quarter of 2018.

That puts 2019 on trend to be the sixth consecutive 200-plus transaction year, according to the Blue Sky Report by Kerrigan Advisors.

The first three months of the year reflect a shift in industry focus towards used vehicles, finance and insurance (“F&I”), and service and parts. Kerrigan noted that this shift to higher margin profit centers is a key reason strategic buyers and outside investors remain interested in auto retail acquisitions, with particular interest in high performing dealerships representing strong franchises in growth markets.

According to the report, the healthy economy and strong financial markets means there continues to be a high rate of complex multi-dealership transactions. Among the franchises being acquired, domestics continued to grow their buy/sell market share, while import non-luxury franchises saw their market share decline, primarily driven by Hyundai, Kia, Mazda, Nissan and Volkswagen. Interest in top domestic franchises, such as Chevrolet and Ford, as well as top non-luxury imports, such as Toyota, Honda and Subaru remain high.

CarMax Inc. has opened a new store in Pharr, Texas.


This is the company’s first in the Rio Grande Valley region and 22nd in the state.


CarMax Pharr is located at 1300 East I-2 and has the capacity to stock approximately 300 used vehicles.


In celebration of the Pharr store opening, The CarMax Foundation is awarding a $10,000 grant to the Food Bank of the Rio Grande Valley. The donation for this organization came at the recommendation of the Pharr CarMax associates.

CarMax Adds Store

June 03, 2019

CarMax Inc. has opened a new store in Killeen, Texas.


This is the company’s first in the Waco area and 21st in the state. CarMax Killeen is located at 3504 E. Central Texas Expressway and has the capacity to stock approximately 140 used vehicles.


In celebration of the Killeen store opening, CarMax and The CarMax Foundation are awarding $5,000 in donations and grants to the Food Care Center in Killeen. The donation for this organization came at the recommendation of the Killeen CarMax associates.

New-vehicle retail sales are expected to fall in May from a year ago, according to a forecast developed jointly by J.D. Power and LMC Automotive.

Retail sales are projected to reach 1,226,800 units, a 3.1 percent decrease compared with May 2018. The seasonally adjusted annualized rate (SAAR) for retail sales is expected to be 13.5 million units, down nearly 200,000 from a year ago.

Sales have declined every month this year, with calendar year-to-date sales through May expected to be down 5.2 percent compared with the same period in 2018.
Total sales in May are projected to reach 1,558,800 units, a 2.1 percent decrease compared with May 2018. The seasonally adjusted annualized rate (SAAR) for total sales is expected to be 17 million units, down 200,000 from a year ago.

The number of new vehicles sitting on dealer lots is rising. On average, new vehicles sold in May spent 74 days on dealer lots, the highest level for the month of May since 2009.

Twenty-nine percent of vehicles sold so far in May have sat on lots for 90 days or longer, up from just over a quarter of vehicles last year.

Incentive spending per unit so far in May is $3,722, up $25 from last year. Spending as a percentage of MSRP remains below the 10 percent threshold at 9.1 percent.

Transaction prices are continuing to rise. New-vehicle prices in May are on pace to reach $33,457—the highest ever for the month—and are up more than 4 percent ($1,345) from last year. The record prices reflect higher prices for both cars (up 3 percent to $27,259) and trucks/SUVs (up 4 percent to $36,388).

The growth in average prices is due primarily to sales weakness at lower price points. Retail sales of vehicles under $30,000 are expected to be down 5.7 percent in May, compared with 2.1 percent for the market overall.

Carvana Co. has priced the private placement of an additional $250 million aggregate principal amount of its 8.875 percent senior notes due 2023.


The new notes priced at 100.500 percent of their principal amount, plus accrued and unpaid interest from April 1, 2019, representing a yield to call of 8.693 percent. The new notes will be issued as additional notes under the contract governing the outstanding $350 million of senior notes that were issued on Sept. 21, 2018.


Carvana anticipates that the closing of the offering of the new notes will take place on or about May 24, subject to customary closing conditions.


Carvana also announced the upsize and pricing of its concurrent underwritten public offering of 4.2 million shares of its Class A common stock at a public offering price of $65 per share. Carvana granted the underwriters a 30-day option to purchase up to an additional 630,000 shares of its Class A common stock.


The public offering was upsized from the previously announced offering size of 3.5 million shares of Class A common stock.


Carvana intends to use the net proceeds from the new notes offering and the public offering for general corporate purposes. Carvana may use the net proceeds from these offerings to partially repay borrowings under its floor plan facility until it identifies other specific uses.

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