MEDFORD, Ore. — Lithia Motors Inc., the nations’ third-largest auto group, announced the acquisition of Hamilton Honda of Hamilton Township, N.J. The store ranks 23rd among Honda dealerships nationwide and No. 8 in the New York metropolitan area, generating $160 million in revenue in 2018.
In a statement, Lithia’s directors said the acquisition fits the group’s strategy of buying high-volume stores they believe are underperforming.
“We’re excited to welcome the Hamilton Honda team. They built strong market share with a very customer focused strategy,” said Lithia’s president and CEO, Bryan DeBoer. “We’re eager to help them translate that share into increased profitability through leveraging our internal performance data.”
The store was owned by Michael Saporito and Jessie Armstead, a former NFL linebacker, partners in a group that once included eight dealerships but has now dwindled to two. Five of the group’s Michigan and Pennsylvania stores were sued by Nissan Motor Acceptance Corp. and Hyundai Capital America last year. The captives alleged the dealerships had sold hundreds of vehicles out of trust.
Apparently undeterred, “The environment for purchasing dealerships is active,” DeBoer said. “We will continue to seek strategic acquisitions where performance management, digital innovation and our passion to serve consumers wherever, whenever, and however they desire increases the market share of the store.”
Remarkably, reports indicate Lithia will keep Saporito in place as principal of Hamilton Honda — a highly unusual arrangement, according to automotive M&A expert Mark Johnson of MD Johnson Inc.
“I have never seen a dealer buy a dealership and keep the operator in the store if they’re out of trust with other stores,” Johnson told Automotive News. “My typical clients probably would find that politically incorrect.”