In 1941, the year of the Pearl Harbor attack and America’s entrance into World War II, there were slightly more than 47,000 car dealerships across the United States, largely operated by first-generation business owners.
The approximate number of U.S. dealership owners has decreased from 40,000 in the 1930s to 20,000 in the 1980s and 8,000 in the 2010s, according to the National Automobile Dealers Association and dealership sell-side advisory firm Kerrigan Advisors in Incline Village, Nev.
Now with big, public dealership groups such as Lithia Motors Inc. that own hundreds of U.S. stores, and numerous regional, growing private dealership groups, will consolidation follow a similar pattern in the next several decades? Will the number of dealership owners shrink to 4,000 in the 2050s?
Erin Kerrigan, managing director of Kerrigan Advisors, told Automotive News she thinks the dealership ownership figure is still about 8,000 and she predicts the number of owners will fall to about 6,000 in the next 20 to 25 years. Kerrigan said the largest consolidators, such as those on Automotive News’ top 150 dealership groups list, will make up “the preponderance of retailers in auto retail.”
“It’s not like we’re consolidating like a grocery store chain, right?” Kerrigan said. “There will still be a lot of retailers. But I think what you’re going to find is, the majority of industry sales will go to those top 150, and then a minority will go to smaller dealers, non-metro dealers, in smaller markets where you don’t have the major consolidators.”
As Automotive News celebrates its 100-year anniversary, we are looking at today’s topics through historic and future lenses. This installment examines future consolidation of dealership ownership.
While several industry experts who spoke with Automotive News were hesitant to predict specific figures, all agreed:
At the beginning of 2025, 18,311 U.S. franchised dealerships existed, according to the Automotive News annual dealer census, up by 171 stores from a year earlier. The number of dealerships has generally declined since 1941, when Automotive News counted 47,133, according to the Automotive News Research & Data Center.
Over 8 decades, the number of U.S. new-vehicle dealerships has declined by more than 60%. There were just more than 47,000 U.S. dealerships in 1941. At the beginning of 2025, there were 18,311 franchised dealerships in the U.S. This chart shows the number of dealerships in the U.S. starting in 1947 because annual counts for 1942-1946 are unavailable.
But the number of owners of those stores isn’t as clear-cut.
Glenn Mercer, president of Cleveland consulting firm GM Automotive, estimates there are now about 6,500 dealership owners.
He said the number of stores during the 1950s, for example, typically equaled the number of dealers. Mercer said the number of dealership owners declined steadily until 2010 and has been flat since.
He said the number of stores during the 1950s, for example, typically equaled the number of dealers. Mercer said the number of dealership owners declined steadily until 2010 and has been flat since.
Mercer’s estimates are based on data he has gathered from industry associations, dealer conferences and dealership brokerage firms, he said.
Mercer thinks the rate of decline in dealership owners could slow some.
“On the buying side, a lot of the low-hanging fruit has been bought already, and on the selling side, a lot of the people who thought they would get out have done so, and the rest are in it for the longer haul,” he said.
According to the NADA Data 2024 Mid-Year Report, 91.4 percent of dealership owners own between one and five stores, a figure that decreased from 95 percent in 2014, as dealerships have been absorbed in consolidation.
“That one-to-five bucket will be under 90 percent very shortly and in 10 to 15 years, it would probably be in the low 80s or 70s,” said David Whiston, a Morningstar analyst who covers auto retail. “I don’t see any of that abating.”
Whiston said pricey dealership image requirements and automakers awarding open points to multiple-store operators could contribute to the decline.
While fewer dealership operators own one to five stores, there was a surge in those that own 26 to 50 stores, up from 0.1 percent in 2014 to 0.5 percent in June 2024, according to NADA.
The vast majority of new light-vehicle dealership operators -- 91.4% -- own 1 to 5 stores as of June 2024. But, that figure dropped each year since 2014, when 95% of dealers owned that many dealerships. The percentage of dealers operating 6-10, 11-25, 26-50 and greater than 50 stores all increased.
That segment will grow most, according to Jesse Stopnitzky, co-founder of Performance Brokerage Services, a buy-sell firm in Irvine, Calif., who has been in the mergers and acquisitions industry since the 1990s.
He said while dealer owners of one or two stores historically spurred buy-sell activity the past 30 years, public companies and top dealership groups will create more deals now because of their acquisition power.
“They have found a more efficient path to scaling their businesses and their national presence by acquiring regional platforms and dealership groups,” Stopnitzky said.
Not even 10 years ago, in 2017, Wall Street analyst Adam Jonas made a bold prediction amid AutoNation Inc. agreeing to service Waymo’s self-driving cars in a longtime partnership. Jonas wrote in a note to investors that year that he saw an estimated 10,000 dealership owners shrinking to a fraction. He wrote that “tech disruption could consolidate this to as few as 10 monolithic mega-fleet managers supporting the future shared autonomous transportation ecosystem.”
Jonas declined to comment for this story through a spokesperson at Morgan Stanley.
Dealerships on Automotive News’ 2025 top 150 dealership groups list together sold just more than 4 million new vehicles in 2024, or 26.7 percent of the industry’s total retail sales, up by 1 percentage point from a year earlier.
The top 150 dealership groups also grew their ownership of the industry’s stores, reaching 26.6 percent of the nation’s 18,311 franchised dealerships in 2024, up from 25.3 percent in 2023.
Kerrigan estimates the top 150 dealership groups control about 30 percent of industry revenue.
In less than two decades, she predicts those groups will inch closer to controlling about half of the industry’s revenue.
“I expect that in the next 20 years, we will hit a tipping point in which the industry becomes quite consolidated, and you have the top 150 representing the majority of auto sales,” Kerrigan said.
While consolidation will continue, the entrepreneurial spirit of dealers will make it slower, George Karolis, president of investment banking and buy-sell advisory firm Presidio Group, told Automotive News.
“There’s just so many entrepreneurs, so many dealers, so many private dealers that love the business, that are active in the business, that are multigenerational,” he said.
There are still just six major public auto retailers, and about 90 percent of dealerships now are owned by private dealers – dealers who love their industry, he said.
“We have a huge database, we’ve been at this nearly 20 years, and yet, I still meet a new dealer/owner regularly,” Karolis said.
This Automotive News feature lists dealership acquisitions as reported by brokers, official announcements and news media. See our list of 2025-dbuy-sells and submit details of your deals here.
Mike Sims, president of advisory firm Pinnacle Mergers & Acquisitions, of Southlake, Texas, thinks consolidation will continue at a quick pace in metro markets but not as much in rural areas.
Sims told Automotive News that for metro areas, factors such as store values and automakers looking to reduce dealer count will help fuel continued consolidation, while those trends may not affect rural stores as much.
If a company hires or develops a great general manager, capable of maximizing profits, Sims said, it doesn’t make much business sense to place them in a rural store where geography will cap their potential.
“And so, I just don’t think that there’s a big consolidation play for the less-populated areas, so that’s why I think you’re always going to see the more traditional, family-owned dealerships in those markets,” Sims said.
Farid Ahmad, CEO of advisory firm Dealer Solutions Mergers and Acquisitions, with locations in Canada and the U.S., shared similar views.
“My prediction in the next 10-15 years is there will always be what I call the hometown dealer, who will service a smaller community,” Ahmad said. “It will most probably be passed on from family member to family member, or the general manager that runs the store on behalf of the owner will buy out that dealer.”
Nancy Phillips, founder of buy-sell firm Nancy Phillips Associates in Exeter, N.H., said consolidation is an ongoing process, with dealerships being sold predominantly to one of three buyer types: multiple-location local dealers, regional groups or national dealer networks. Franchisors are proactively shaping their networks by merging locations, eliminating select dealerships and exercising the right of first refusal, the manufacturer’s ability to reject a buyer and assign one of its choosing.
This creates a struggle for single dealership owners trying to compete with larger players, Phillips said.
Alan Haig, president of advisory firm Haig Partners, of Fort Lauderdale, Fla., said consolidation will continue, especially for larger groups with 20 or more stores.
Bigger companies will harness their scale, larger inventories and reach, taking market share more easily, and those dealers who own fewer stores will have to invest or consider scaling up to stay competitive, Haig said.
Not all consolidation is great, Haig said.
“Who’s going to be supporting the Little League teams? Who’s going to be supporting the PTA?” Haig said. “The local dealer: He’s going to the Kiwanis, he’s supporting local charities.
“And that matters.”
Throughout 2025, we will honor our legacy by connecting topics of today with our historical coverage as we look ahead to the next 100 years.
Kerrigan Advisors is the leading sell-side advisor and thought partner to auto dealers nationwide. Since its founding in 2014, the firm has led the industry with the sale of over 285 dealerships generating more than $9 billion in client proceeds, including two of the largest transactions in auto retail history – the sale of Jim Koons Automotive Companies to Asbury Automotive Group and Leith Automotive to Holman. The firm advises the industry’s leading dealership groups, enhancing value through the lifecycle of growing, operating and, when the time is right, selling their businesses. Led by a team of veteran industry experts with backgrounds in investment banking, private equity, accounting, finance and real estate, Kerrigan Advisors is the only firm in auto retail exclusively dedicated to sell-side advisory, providing its clients the assurance of a conflict-free approach.
Kerrigan Advisors monitors conditions in the buy/sell market and publishes an in-depth analysis each quarter in The Blue Sky Report®, the industry authority on dealership buy/sell market trends and valuations and includes Kerrigan Advisors’ signature blue sky charts, multiples and analysis for each franchise in the luxury and non-luxury segments. To download a preview of the report, click here. The firm also releases The Kerrigan Index™ comprised of the seven publicly traded auto retail companies with operations focused on the US market. The Kerrigan Auto Retail Index is designed to track dealership valuation trends, while also providing key insights into factors influencing auto retail. To access The Kerrigan Index™, click here. To read the 2024 Kerrigan Dealer Survey, click here. To read the 2024 Kerrigan OEM Survey, click here. Kerrigan Advisors also is the co-author of NADA’s Guide to Buying and Selling a Dealership.
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