Lithia & Driveway make 3 distinct moves, reflecting the depth of the business
Lithia & Driveway showed the depth and diversity of its automotive business via the trio of moves the company announced on Tuesday.
The actions included the acquisition of five stores, an equity issue associated with its financial company, and the launch of a state-of-the-art customer relationship management (CRM) and workflow platform.
The acquisition allowed Lithia & Driveway to expand its North Central footprint with the purchase of five Wilde Automotive Group stores in Wisconsin.
According to a press release, the Wisconsin group was started by Harold Wilde in 1966 and includes Wilde Toyota, Wilde Subaru, Wilde Honda, Wilde CJDR and East Towne Honda.
Together, Lithia & Driveway said those stores are expected to generate $625 million in annualized revenue. LAD also expects to complete network optimization (divestments) of approximately $625 million in annualized revenue in 2022.
Lithia & Driveway stressed that the pipeline of opportunities to continue network expansion remains “robust, leading LAD to another record year of growth.”
Lithia & Driveway President and CEO Bryan DeBoer then said in the press release, “We are thrilled to welcome these high-performing teams to our Lithia & Driveway family.
“Their continued pursuit of excellence has earned them numerous awards, including the President’s Recognition for Honda Stores and the Toyota Store, as well as excellent reputations for serving their customers and communities,” he added. .
Meanwhile, the company said in the same statement that Driveway Finance Corp. (DFC) had completed its second issuance of securities backed by its initial auto finance portfolio, raising more than $298 million in additional capital to fund growth.
“DFC continues to receive favorable pricing and credit ratings,” said Lithia & Driveway Vice President of Finance Chuck Lietz. “We are confident in our ability to fund DFC using a combination of our conduit facilities and our securitizations, which will enable us to grow DFC in the years to come and support LAD’s realization of more than $1 in EPS for every $1 billion in revenue.”
The company said DFC creations now make up around 10% of LAD’s overall business and are expected to grow to 15% in the coming years.
Executives noted that this growing revenue stream further diversifies LAD’s business model, increases profitability and improves consumer loyalty with its Driveway and GreenCars stores and national brands.
Finally, Driveway activated Freeway, a state-of-the-art customer relationship management (CRM) and workflow platform, enabling its care centers to serve customers more seamlessly and efficiently when shopping. , finance, sell and maintain their vehicles in comfort. of their homes.
“We are excited to deploy Freeway, our latest strategic platform to further fuel the growth of Driveway and LAD’s omnichannel capabilities,” said George Hines, chief innovation and technology officer of Lithia & Driveway.
“We create a competitive advantage by leveraging technology and data to anticipate our customers’ needs. Our Freeway Platform gives our Driveway Care Centers a unified view of our customers’ journey to meet their needs as efficiently as possible,” continued Hines.