NC auto group buys another firm for $700 million, one of largest deals in industry history
Sonic Automotive plans to buy RFJ Auto Partners for $700 million, calling it “one of the largest transactions in automotive retail history.”
The deal announced Wednesday by Charlotte-based Sonic Automotive is expected to be finalized in December. The move will push Sonic Automotive into the top-five largest dealer groups in the country by revenue, according to a Sonic Automotive news release.
The price of the acquisition is $700 million, a Sonic Automotive official told the Observer.
The deal will add about $3.2 billion in annualized revenue for Sonic Automotive, a 30% increase in franchised dealership revenues above Sonic Automotive’s $25 billion total revenue target by 2025, the release said.
The transaction aligns with Sonic Automotive’s strategy to grow its franchised dealership business in new geographic areas and expand its brand portfolio, said Jeff Dyke, president of Sonic Automotive and EchoPark Automotive.
RFJ Auto is based in Plano, Texas.
The deal adds several states and five brands to Sonic Automotive’s portfolio. Sonic Automotive already has locations in Texas, as well as in Alabama, California, Colorado, Florida, Georgia, Maryland, Nevada, North Carolina, South Carolina, Tennessee and Virginia. Now it will add Idaho, Indiana, Missouri, Montana, New Mexico and Washington to its footprint.
In July, Sonic Automotive reported a record $3.4 billion in revenue for the second quarter, up 58.7% year-over-year, according to the company website. It reported total revenue for 2020 was $9.8 billion.
RFJ Auto’s nearly 1,700 employees will join Sonic Automotive’s 8,500 employees as part of the company’s “growth strategy,” said David Smith, CEO of Sonic Automotive and EchoPark Automotive.
More about Sonic Automotive
RFJ Auto is the latest expansion move by Sonic Automotive, with its headquarters in Charlotte’s Cotswold area.
Sonic Automotive recently acquired four franchised dealerships in Colorado, according to the company.
The Fortune 500 firm also has been focused on expanding its EchoPark Automotive segment, launched seven years ago. EchoPark offers used one- to four-year-old cars at a discount, and allows people to buy and sell cars through its website or retail locations.
Last year, Sonic Automotive purchased 4 acres for $3.2 million to expand the EchoPark store at 3648 E. Independence Blvd., the Observer previously reported. The Charlotte location was one of the first for the brand, and the company expects to add another 25 retail hubs or delivery centers every year through 2025.
Just this summer, Sonic Automotive added EchoPark delivery stations in Texas, Las Vegas, Florida, Kentucky, Utah, Georgia and Greensboro, according to the company.
Sonic Automotive has 87 franchised dealerships. There are about 1,000 employees in Charlotte, half of whom are at Sonic Automotive’s corporate offices, Greenwald said.
Also this month, Sonic Automotive raised its hourly minimum wage to $15 an hour.
More about RFJ Auto
RFJ Auto has 33 locations in seven states and 16 automotive brands.
The seven-year-old company had $2.8 billion in annual revenue last year, making it a top-15 U.S. dealer group by total revenue, according to the news release.
The RFJ Auto brand portfolio includes Chrysler, Jeep, Dodge, RAM, Chevrolet, GMC, Buick, Lexus, Toyota, Ford, Nissan, Hyundai, Honda, Mazda, Alfa Romeo, Maserati, and pre-owned vehicle locations throughout the Pacific Northwest, Midwest and Southwest.
This story was originally published September 22, 2021 at 12:04 PM.