Performance Brokerage Services Urges Car Dealers to Capitalize on Exceptional Buy-Sell Environment Before it Passes

Share Article

Due to recent events, Performance Brokerage Services advises clients to seriously consider this unique environment in which the goodwill portion of the purchase price for car dealerships have reached record highs, as they too will fade.

Performance Brokerage Services

Performance Brokerage Services

Prices have gotten very, very high. I don’t see that type of pace in the U.S. in the near term. - Earl Hesterberg, CEO of Group 1 Automotive

Performance Brokerage Services, Inc. specializes in intermediary services for buyers and sellers of new car dealerships. With over 23 years of experience and over 400 successful transactions nationally, the principals of Performance Brokerage have naturally witnessed cycles of high and low purchase prices for dealerships. Understanding that business is cyclical, Performance Brokerage has been advising their clients to give serious consideration to this unique moment in time and environment of exceptionally high goodwill values.

Moshe Stopnitzky, President of Performance Brokerage shares “The recession shocked the automotive industry and caused many dealers to fail. Those low hanging fruit were picked up quickly by the bargain seeking buyers. It was then a buyer’s market like we have never witnessed before.” Since, (a) there was a shutdown of many dealerships, (b) the average age of new vehicles on the road exceeded averages for previous years, (c) consumer financing became available again, and (d) dealers trimmed the fat and minimized their fixed expenses. This unique combination along with the pent up demand has led to soaring dealership profits in recent years.

As successful dealers were able to maximize their revenues and profits through sales and service, their next natural business step was to acquire additional dealerships. Seasoned buyers, regional dealers, national dealership groups and the public companies such as Lithia Motors, Group 1 Automotive, and Asbury Automotive Group have been persistent in their efforts of acquiring quality dealerships. This competition inevitably drove up the purchase prices. Moshe Stopnitzky mentions, “Even after 23 years, we are negotiating and closing transactions at price levels that surprise even us. However, we are confident that the current trend is not sustainable. We urge our clients to evaluate their goals for the next 2 to 3 years, and if it includes selling a car dealership, to begin the planning now, before the current trend fades away. A seller’s market today can become a buyer’s market tomorrow.”

Group 1 Automotive, Inc. based in Houston, Texas is the nation’s third largest automotive group and a Fortune 500 company. Discouraged by the high purchase prices for new car dealerships and the less than desired rate of return, Group 1 Automotive, Inc. recently announced that they would remain on the sidelines for the near future, reducing their acquisition rate. In a report by the Automotive News, CEO of Group 1 Automotive, Earl Hesterberg stated, “Prices have gotten very, very high. I don’t see that type of pace in the U.S. in the near term.”

“This only demonstrates that our prediction is rather accurate. Potential sellers should act now, before other buyers adopt a similar attitude towards these record breaking values,” concludes Moshe Stopnitzky.

About Performance Brokerage Services
Performance Brokerage Services, an auto dealership broker, specializes in professional intermediary services to buyers and sellers of automotive, Harley-Davidson and Powersports dealerships.

The company offers a different approach to the automotive brokerage industry by providing free dealership assessments, no upfront fees, no reimbursement of costs and is paid a success fee only. Performance Brokerage Services gets paid only after the client gets paid.

With over 23 years of experience, the company utilizes an extensive network of industry related accountants, attorneys, hundreds of registered buyers and enjoys longstanding relationships with most of the auto manufacturers. The mediators at Performance Brokerage have been involved in well over 400 transactions nationally.

With corporate offices located at 7545 Irvine Center Drive, Suite 200, Irvine, CA 92618 and three satellite offices in Utah, Florida and New Jersey, Performance Brokerage provides national exposure with local representation. Pledging loyal and unwavering representation, confidentiality is vigilantly protected during the selling process and after the transaction closes.

For more information about the services offered by Performance Brokerage Services, visit http://www.performancebrokerageservices.com.

Share article on socal media or email:

View article via:

Pdf Print

Contact Author

Jason Stopnitzky
@CarDealerBroker
Follow >
Performance Brokerage Services
Like >
Follow us on
Visit website