New Era Taking Shape in Auto Retail Vendor M&A Activity

November 1, 2019 — Pivotal. That’s probably the best word to describe vendor mergers and acquisitions and investments among automotive retail vendors in 2019. Aggressive roll-up plays, new directions, and evolving industries forming now will reshape the industry over the next five years.

In TBR’s Third Quarter Report on Auto Retail Vendor Merger and Acquisition Activity subscribers will find:

• Review of the year’s 62 transactions
• Discussion of the trends impacting investments and M&A activity
• Outlook for the next several months including a breakdown of which companies are buyers and which are sellers

Normally, we publish a report of this scope at the end of the year, but we believe there will be significant activity over the next few months that demands a more thorough analysis because of the resulting impact.

Below is a snapshot of this year’s activity thus far:

• Service – 10 (Includes three mobile on-demand transactions; three online parts ordering deals; two cloud-based retail experience investments. Add the collision repair plays, reconditioning-related transactions, and some of the connected vehicle activity, the Service category is the clear leader in M&A activity.)
• F&I – 8 (includes at least five fintech-related deals)
• Data Marketing (Ad Tech) – 8
• Connected Vehicle – 6
• Online Transaction – 6 (if we included fintech deals, this number becomes 11)
• Data Marketing – 6
• Vehicle Subscription – 4 (all transactions by Fair)
• Fleet Management – 3 (several of the connected vehicle-related transactions could be included in the Fleet category)
• Collision Repair – 2
• Online Auctions – 2 (this is a hot category — ACV Auctions and KAR’s TradeRev are leading the way, but not without challenges. New entries such as CarOffer launched by Bruce Thompson this year could rewrite how dealers manage “wholesale” inventory – think 24/7 trade desk for used vehicles)
• Vehicle Inspection – 2 (Two new companies enter the market this year with significant investments. Israeli-based Uveye and Fyusion. Look for Black Widow out of Missouri to start making a move.)
• Reconditioning – 2 (This is becoming an interesting category as Hugh Hathcock rolls out ReconVelocity to compete with iRecon, Rapid Recon and numerous other smaller players in the space.)
• Dealer Management System (DMS) – 1 (could become three if Tekion, with its two investments, moves in that direction, which based on conversations with dealers, it is.)
• Vehicle Insurance – 1 (Interesting company Dealer Policy raised money from Mtech Capital and Stone Point Capital.)
• Vehicle Self-Payments – 1 (Using the vehicle as a payment system at gas stations and fast-food restaurants — is there a dealer F&I play?)
• Vehicle Salvage – 1 (KAR’s spinoff of IAA)

Of course, M&A activity is fluid (a great example is Cars.com’s strategic initiative earlier this year that failed to produce a buyer), meaning, what we publish today may change tomorrow.

Nevertheless, the report will provide subscribers with an understanding of what trends are driving M&A today and how that activity will impact dealers – and the entire industry over the next several years.

The report in its entirety along with downloadable Excel documents with this year’s deals and deals from 2018 is available to premium subscribers to The Banks Report. The spreadsheets provide financial and transaction data for the deals in which that information is available. 

Click Here to access the report (for premium subscribers):

New Era Taking Shape in Auto Retail Vendor M&A Activity

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