DCG Posted May 13, 2015 Share Posted May 13, 2015 I work in this industry, and nearly all of the large dealership groups (including Berkshire Automotive) are large clients of ours. Trying to speculate which dealership might be next on Buffett's shopping list. Sonic Automotive Group 1 Penske Hendrick Auto Asbury Auto Lithia Motos Larry H. Miller Herb Chambers I'd think Sonic or Asbury (both public companies) might be on the top of their list, they seem to be well-run companies and aren't super overpriced right now. I could see them buying Group 1 as well. Link to comment Share on other sites More sharing options...
Value418 Posted May 13, 2015 Share Posted May 13, 2015 Performance out of Lincoln, NE? Link to comment Share on other sites More sharing options...
DCG Posted May 13, 2015 Author Share Posted May 13, 2015 Not sure Performance is large enough for Buffet to consider, unless he's planning on piecing together a bunch of smaller groups. Link to comment Share on other sites More sharing options...
gfp Posted May 13, 2015 Share Posted May 13, 2015 The MO for Van Tuyl / Berkshire so far has not been to acquire large groups. They have acquired 3 or 4 dealerships since the deal was announced and they are likely to continue their joint venture model where they partner with the selling management team. Link to comment Share on other sites More sharing options...
Guest longinvestor Posted May 13, 2015 Share Posted May 13, 2015 The MO for Van Tuyl / Berkshire so far has not been to acquire large groups. They have acquired 3 or 4 dealerships since the deal was announced and they are likely to continue their joint venture model where they partner with the selling management team. +1 LVT and WEB said as much in an interview. With dealers needing to come to them at fair prices, this is likely to be a slow grind Link to comment Share on other sites More sharing options...
Rust Belt Capital Posted May 29, 2015 Share Posted May 29, 2015 DCG, I was wondering if you could share any thoughts you have on the relative quality of the publicly traded dealerships? I have been doing work on them and to me AutoNation seems to be the gold standard, I really like what they've done with the branding strategy and the fully transactional website they are rolling out. Would love to hear feedback from some one that works directly with the large dealer groups! Link to comment Share on other sites More sharing options...
nkp007 Posted May 29, 2015 Share Posted May 29, 2015 Anyone have an opinion on Sonic Automotive? $sah -Looks decently priced ~12-13x E. -Parts + Service Tailwind -Family-owned /controlled - 50%+ (low liquidity) -Reinvesting into growth opportunities - temporarily depressing earnings. I figure if the initiatives don't work out, they can simply stop. It's a self-inflicted overhang. Link to comment Share on other sites More sharing options...
Rust Belt Capital Posted June 2, 2015 Share Posted June 2, 2015 Anyone have an opinion on Sonic Automotive? $sah -Looks decently priced ~12-13x E. -Parts + Service Tailwind -Family-owned /controlled - 50%+ (low liquidity) -Reinvesting into growth opportunities - temporarily depressing earnings. I figure if the initiatives don't work out, they can simply stop. It's a self-inflicted overhang. Just started digging in to SAH today - what are your thoughts aside from the above? after a cursory glance, surprised that their gross margins are so low given their high weighting towards luxury dealerships. Low EBIT margins and high SGA&A/gross profit not encouraging, but that is an area where they should be able to improve by centralizing store-level processes and standardizing best practices (a la AN's Shared Service Center) I like the increased weighting towards luxury - i believe luxury brands tend to have more/longer OEM warranties, and higher service retention for dealers. Which should dovetail nicely w/ cyclical P&S tailwind. Will update once i've gone through more of their material Link to comment Share on other sites More sharing options...
fareastwarriors Posted June 4, 2015 Share Posted June 4, 2015 interesting stuff More than 398,000 vehicles were sold through Costco’s warehouse stores last year vs. more than 199,000 in 2008. Costco Moves the Metal Costco’s warehouse clubs have become big sellers of cars http://www.bloomberg.com/news/articles/2015-06-04/costco-moves-the-metal Link to comment Share on other sites More sharing options...
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