This year’s close reminds me a bit of a Dicken’s novel – “It was the best of times, it was the worst of times.” Not me personally – its been a great year. Dealers, however, may feel differently.
Since most dealers are optimists, they likely tilt towards the best of times. Sales were good, after all. According to J.D. Power’s Senior Vice President of the Data and Analytics Division Thomas King, “While 2017 retail sales will be below 14 million units, the year will still rank as the eighth-best retail sales year in history….” But the monthly rate of sales slowed in more than half of the months this year.
While 2018 sales are expected to drop compared to this year, they will still be fairly robust. But dealers are also facing unprecedented changes in the industry, changes that look to challenge the business model that has worked so well for a century. Still, optimists that they are, I expect dealers to face these changes and find opportunity in them.
One immediate change for next year is the new tax law. In this issue, I look at how it may impact the buy sell market and the dealership business.
In the buy sell market, buyers are always looking for an underperforming dealership because they figure there is a lot they can do to boost its performance. They may also think that dealership’s valuation won’t be as high as a dealership that is at the top of its game. Think again.
Underperforming dealerships may still ask for, and receive, a high price. Read Ken Rosenfield’s column this week to learn more about valuing underperforming dealerships.
And of course we have Transaction News!
Thanks for being our loyal readers in 2017. We here at Automotive Buy Sell Report look forward to bringing you more news and information in 2018. If there is something you would like us to cover, or a column you would like to contribute, please let us know.
Meanwhile, enjoy this week’s issue!