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.

The estimated average transaction price for a new light vehicle reached $37,185 in May, according to Kelley Blue Book.

New-vehicle prices increased $1,320 from May 2018, while decreasing $208 from April.  

Fiat Chrysler had another strong month, posting more than a 6 percent increase, thanks to Ram and Jeep. Subaru also had another strong increase, as average transaction prices rose by 5 percent.

Used-car sales are expected to decline slightly in May, Edmunds reports.

 An estimated 3.4 million used vehicles will be sold in May. That is down from 3.5 million in April.

Edmunds forecast that 1,551,643 new vehicles will be sold in May for an estimated seasonally adjusted annual rate of 17 million. This reflects a 15.9 percent increase in sales from April, but a 2.2 percent decrease from May 2018.

Edmunds estimates that retail SAAR will come in at 13.8 million vehicles in May, with fleet transactions accounting for 18.9 percent of total sales.

Black Book’s Used Vehicle Retention Index was basically flat in April, declining to 113.6 from 113.8 in March.

Despite the Index now falling for five straight months it is still 1.4 percent higher than a year ago, when it stood at 112.

A total of 14 segments finished the month in positive change territory, led by Premium Sporty Cars with a gain of 1.4 percent.

Sales of used vehicles totaled 9.9 million units worth $107.6 billion at National Auto Auction Association (NAAA) member auto auctions last year, according to the trade organization's 22nd annual survey.

The survey found that the number of vehicles entering the auto auctions decreased by 4.2 percent to 16.6 million and the number of units sold was down 8 percent 
from 2017.

Conducted by Robert A. Casey Consulting of Burke, Va., for NAAA, the survey had a 71 percent response rate representing 247 NAAA North American member auto auctions.

The reported total vehicles entered and sold, and the related gross values are projected to estimate the totals for all 348 NAAA member auto auctions.

Dealer consignment vehicles represented the leading number of units sold at 49.1 percent, fleet-lease at 44.3 percent, followed by factory vehicles at 5.7 percent, and 0.9 percent from other sources.

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