RRR Automotive Group recently completed the sale of five new car dealerships in Maryland to Houston-based Group 1 Automotive.
The transaction expands Group 1’s presence in the region and in the non-luxury import brand market. Group 1, which has 198 dealerships located in the U.S. and U.K.,
The acquisition includes the includes the top two volume Honda dealerships in the state of Maryland as well as Toyota, Hyundai, and Kia new vehicle dealerships, a Toyota Certified pre-owned center; and three collision centers.
Group 1 Growth
Group 1’s President and CEO Daryl Kenningham stated he was thrilled to grow the company’s business in the greater Washington, DC area, one of the largest automotive markets in the country.
“These dealerships are some of the best brands in our portfolio and we are very proud to grow our relationship with Toyota, Honda, Kia, and Hyundai,” said Kenningham in a press statement after the deal was announced. “As reflected in our history of successful integration of acquisitions, we work toward integrating these businesses into our company as quickly as possible.”
“We believe, given our proven operational and acquisition integration track record, that this acquisition presents an opportunity to further drive profitable growth for our stockholders.”
Kerrigan Role
The Washington metropolitan region is an import-dominant market with market share at 72% – 24% higher than the U.S. average. RRR Automotive Group has nearly half the share of the markets in which it operates, capturing 48% of Bowie, College Park, Greenbelt and Owings Mills’ import non-luxury sales since 2019.
Kerrigan Advisors, the sell-side advisor to auto dealers nationwide, represented the Maryland-based RRR in the sale.
Erin Kerrigan, founder and managing director of Kerrigan Advisors, offered that the transaction highlights the continued strength of the buy/sell market for top import franchises in economically vibrant markets.
Active Market in 2024
“Despite an elevated interest rate environment and cooling industry profits, dealerships remain one of the most lucrative retail investments in the country,” said Kerrigan. “Leading consolidators continue to reinvest their tremendous profits into acquisitions, attracted to the high return on investment achievable with auto dealerships, particularly import franchises in growing economies like the Baltimore-Washington metro.
“We expect this sizable transaction is an indicator of another active buy/sell market in 2024.”