It’s been a few weeks since the election, and it seems like we are starting to get some additional information on what the next may hold. That seems like a good place to start. Here to weigh in on today’s episode of Inside Automotive is Ryan Kerrigan, Managing Director of Kerrigan Advisors.
Kerrigan begins by discussing how the election outcome could shape the industry, particularly in terms of tariffs, trade dynamics, and the transition to electric vehicles. He notes that due to the global nature of production and trade, there is no such thing as the “American Car,” which further underscores the complexities of the automotive supply chain.
While EV adoption has been a key topic, Kerrigan is cautious about its rapid growth. Despite the recent investments, EVs have only reached 7% of the market, far below the anticipated 60-80%. He predicts that although EV production will increase in the coming years, widespread adoption will remain elusive without further breakthroughs.
On the buy-sell market, Kerrigan highlights its unexpected resilience amid high interest rates, political uncertainty, and rising construction costs. The year’s first three quarters saw a record 330 buy-sell transactions, signaling a strong market performance. Wealth creation among sellers has led to a surge in exits, particularly as rising facility costs make new builds and renovations less viable. Buyers, once hesitant, are now more decisive, especially for dealerships with strong brands like Toyota and Lexus, willing to pay full premiums for well-positioned businesses.
Nevertheless, Kerrigan notes that the industry’s size and adaptability allow it to absorb new disruptors, such as Carvana, while still thriving in the evolving retail space.
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 280 dealerships representing $9 billion in client proceeds, including the third largest transaction in auto retail history – the sale of Jim Koons Automotive Companies to Asbury Automotive Group. 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 does not take listings, rather they develop a customized sales approach for each client to achieve their personal and financial goals. In addition to the firm’s sell-side advisory services, Kerrigan Advisors also provides a suite of consulting and investor services including growth strategy, market valuation assessments, capital allocation, transactional due diligence, open point proposals, operational improvement and real estate due diligence.
Kerrigan Advisors monitors conditions in the buy/sell market and publishes an in-depth analysis each quarter in The Blue Sky Report®, which 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 monthly The Kerrigan Index™ composed 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 2023 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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