Monday, 04 December 2017 03:34
The auto dealership buy/sell market is poised for its most active year ever, with over 200 transaction closings projected for 2017, according to The Blue Sky Report released by Kerrigan Advisors.There were 149 dealership buy/sell transactions completed in the first nine months of 2017, compared to 172 transactions in the first nine months of 2016. After hitting a plateau in 2015, buy/sell activity declined slightly in the first nine months of 2017, but is still tracking to be one of the most active years on record.Multi-dealership transactions represented one quarter of the completed sales in the first nine months of 2017. Kerrigan Advisors expects at least 51 multi-dealership transactions will close this year.Year to date, domestics’ share of the buy/sell market increased to 49 percent, up 18 percent from 2015.Non-luxury and luxury import franchises’ buy/sell market share declined.Public retailers’ U.S. acquisition spending increased 61 percent in the first nine months of 2017 compared to the first nine months of 2016.Private dealership groups represent the largest share of dealership acquirers. Of the estimated 236 franchises, which changed hands in the first nine months of the year, only 23 were acquired by public companies.Real estate, for most dealers, is their most valuable asset, far exceeding franchise value. Kerrigan Advisors estimates dealership real estate prices rose 3 percent in the first nine months of the year.
Friday, 01 December 2017 14:02
Auto sales were mixed but, on balance, steady in the last few months, according to the latest Beige Book from the Federal Reserve. Dealers in upstate New York reported that demand for new vehicles remained fairly robust in October but not quite on par with September's brisk levels. However, scattered increases were reported in used vehicle sales. Vehicle inventories were said to be a bit on the high side but mostly at satisfactory levels. Retail and wholesale credit conditions have remained favorable, according to dealers.Auto dealers in the Philadelphia district reported slight declines overall in year-over-year sales this period, a retreat from the modest increases during the prior period. Dealers were hopeful for stronger sales at year-end, Dealers reported that manufacturers continued to provide incentives for dealers to sustain sales. Growth in auto loan volumes was stronger. Year-to-date new motor vehicle sales through September rose 2 percent in the Cleveland district compared to those of a year ago. That said, auto dealers reported that they are starting to see a slowing in demand after seven consecutive years of gains. Indirect auto lending remained relatively strong.Results were mixed in the Richmond district.A South Carolina auto dealer reported robust growth. However, a Virginia auto dealer reported a drop in sales of high-end vehicles.Recent hurricanes impacted sales in a couple of districts.Auto sales in Dallas were still elevated, but the initial post-hurricane surge had begun to recede.Post Hurricane Irma, Atlanta automobile dealers noted an increase in the momentum of auto sales.Demand for auto finance in Chicago edged down, with contacts noting an uptick in delinquencies in auto loan payments. An auto dealer reported that credit had tightened noticeably for buyers with credit scores at the lower end of the subprime category. Credit card volume increased slightly and quality was unchanged.Multiple auto dealers in the St. Louis district reported a decline in sales, which have failed to meet their expectations during 2017. Memphis and Louisville dealers noted a shift in demand away from used vehicles.Demand for auto loans declined in the district for a second straight quarter, though bankers anticipate that auto lending standards could loosen modestly next quarter.Auto sales continued to fall moderately in the Minneapolis district and were well below year-ago levels. Dealer contacts anticipated a moderate pickup in sales for the months ahead.
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Wednesday, 29 November 2017 22:49
New Jersey-based Chas. S. Winner, Inc., doing business as Winner Ford of Cherry Hill and Winner Ford, will pay $150,000 and furnish significant equitable relief to settle a federal pay discrimination lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC).The EEOC charged that since 2010, Winner Ford paid its Chinese emergency and accessory installation (EAI) technicians a lower starting wage and hourly wage than non-Chinese EAI technicians at its Cherry Hill location. Winner Ford paid starting Chinese EAI technicians up to $3 less per hour than non-Chinese EAI Technicians, even though they did the same work and some of the non-Chinese technicians had less or no relevant experience. The EEOC said that when a Chinese EAI technician complained about the wage disparity, he was reprimanded, and told that if he sought legal advice, he would be out of a job.The EEOC filed suit after first attempting to reach a pre-litigation settlement through its conciliation process.In addition to the $150,000 in lost wages and other damages to the class members, the three-year consent decree prohibits Winner Ford from discriminating based on national origin, including in compensation, or engaging in retaliation. Winner Ford will implement and disseminate an anti-discrimination policy to all employees, applicants and new hires. Winner Ford will also provide training on federal EEO laws to all managers and employees involved in setting wages or handling discrimination complaints. It will also post a notice regarding the settlement.
Tuesday, 28 November 2017 23:50
For the seventh time this year, the new vehicle retail sales pace in November is expected to fall from year-ago levels, according to a forecast developed jointly by J.D. Power and LMC Automotive. The seasonally adjusted annualized rate (SAAR) for retail sales is expected to be 13.4 million units, down 300,000 from a year ago. Retail sales in November are anticipated to reach 1,119,600 units, a 0.1% decrease (selling days adjusted) compared with November 2016.The average new-vehicle retail transaction price to date in November is $32,344, a record for the month, surpassing the previous high for the month of $31,573 set in November 2016.Consumers are on pace to spend $36.2 billion on new vehicles in November, up nearly $800 million from last year’s level.Average incentive spending per unit to date in November is $4,065 per unit, surpassing the previous high for the month of $4,024 set in November 2016. Spending on trucks and SUVs is $3,947, up $17 from last year. Spending on cars is $4,286, up $100.Incentives as a percentage of MSRP are at 10.8% so far in November, exceeding the 10 percent level for 16th time in the past 17 months.Trucks account for 66 percent of new-vehicle retail sales through Nov. 19 - the highest level ever for the month of October - making it the 17th consecutive month above 60 percent.Days to turn, the average number of days a new vehicle sits on a dealer lot before being sold to a retail customer, is 74 through Nov. 19.Fleet sales are expected to total 254,500 units in November, down from November 2016. Fleet volume is expected to account for 19 percent of total light-vehicle sales, flat from last year.