Lithia Motors Inc. (LAD) recently announced the acquisition of Harris Nissan store in Clovis, CA. Lithia will be renaming the store as Lithia Nissan of Clovis which is expected to boost its revenues by $25 million annually.
This store expansion adds to the Nissan portfolio of the company and will also complement its operations in the Fresno location.
Lithia is aggressively pursuing store acquisitions to expand business. In Jun 2014, Lithia acquired General Motors’ (GM) Vic Alfonso Cadillac and Braley & Graham Buick GMC stores in Portland, OR. Lithia will be renaming the outlets as Buick GMC of Beaverton and Cadillac of Portland Lloyd Center, respectively. These stores are expected to increase Lithia’s revenues by $60 million annually.
The inclusion of the stores positions Lithia as the sole Cadillac dealer in Portland along with expanding its BMW and Mercedes Benz store base in the city. Notably, the addition of the General Motors stores takes Lithia’s store count in Portland to seven.
In Apr 2014, Lithia took over Access Ford store in Corpus Christi, TX, and opened Lithia Chrysler Jeep Dodge of Wasilla in Wasilla, AK. The company expects these Ford Motor Co. (F) and Chrysler stores to contribute $105 million to its annual revenues.
Prior to this, in Mar 2014, Lithia bought the Honolulu Buick GMC Cadillac and Honolulu Volkswagen stores in Honolulu, HI. The stores are expected to generate $75 million additional revenues annually. The company presently has three stores in the state and intends to achieve economies of scale by increasing the store count in the region.
Lithia Motors is the eighth largest automotive retailer in the U.S. with 129 stores across 14 states. The company offers 30 new vehicle brands along with all brands of used vehicles.
Currently, Lithia carries a Zacks Rank #4 (Sell). Penske Automotive Group, Inc. (PAG), which also belongs to the same industry, is worth considering with a Zacks Rank #2 (Buy).
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