September 21, 2026
462 dealership transactions closed in the twelve months to June 30, 2026, the most Kerrigan Advisors has counted in any trailing-twelve-month period, up from 454 a year earlier, and they carried 724 franchises with them, according to the firm’s Q2 2026 Blue Sky Report, published in September. The first half of 2026 alone produced 224 transactions and 351 franchises. The Kerrigan Blue Sky Index, benchmarked to 100 at the end of 2019, stayed 78% above that level, which the firm attributes to buyer demand for scale and market share. In the same report, Kerrigan estimates that average dealership earnings declined 10 to 20% year over year, on rising operating costs and comparisons against a strong 2025.
$100 million per store is the benchmark the report names. Group 1 Automotive’s agreed purchase of Hennessy Automobile Companies, ten dealerships in the Atlanta market, announced July 30 at $1 billion of blue sky (about $1.3 billion with the real estate, per Group 1’s announcement), set a new high for blue sky pricing on a group of that size, and Kerrigan says it drove public groups’ acquisition spending per dealership and the average revenue of the dealerships they acquired to records. GCBC’s August 10 analysis of the Hennessy deal argued that record prices create sellers by giving family groups a comp they cannot ignore. Kerrigan’s twelve-month window closed June 30, five weeks before the Hennessy announcement, so the comp’s effect on sellers is a third-quarter question.
10 to 20% less earnings against a valuation index that did not fall is the arithmetic that matters for anyone pricing a store this autumn. A blue sky multiple is applied to earnings, so if the multiple held and earnings fell by a fifth, the dollar value of the average franchise fell with them; if the index held instead, the multiple rose. Kerrigan’s index is a valuation measure, and it held, so the implied multiple on this year’s earnings went up. Buyers, on the report’s own account, are paying for scale and share rather than for the earnings the store produced in the last four quarters. That is a bet that operating costs normalize and that the 2025 comparison was the anomaly, and the public groups are making it with record cheques.
Three multiple changes tell you where the buyers think the volume is going. Kerrigan raised Kia’s low-end blue sky multiple to 5.0x and reduced both Volkswagen and Audi, citing changing franchise performance. Kia America reported 83,793 sales in August 2026, which it calls its best month ever, and 590,377 through August, up 3.5%; GCBC’s Kia US series carries the same August and year-to-date figures. Audi’s US sales went the other way: 67,916 in the first half of 2026, down 17.1% from 81,957, a figure that also matches Audi of America’s own half-year number. A 5.0x floor on a franchise setting sales records and a cut on one that has lost a sixth of its volume is the report translating the sales tables into prices.
1.57 franchises changed hands per transaction, in the half and in the twelve months alike: 351 franchises across 224 deals, 724 across 462. The buy/sell market is a market for groups and multi-point stores. A count that rises while the franchises-per-deal ratio holds means more sellers came to market, rather than the same sellers bringing bigger portfolios.
46% of transactions involved domestic brands, down from 51% in 2025, and the public groups spent $6.0 billion on acquisitions in the trailing twelve months at an average of $119 million per dealership, figures CBT News reports from the report itself; Kerrigan’s public summary page does not carry them, and this piece treats them as the trade press’s reading of the report rather than as the report.
224 transactions in the first half of 2026 compares with 220 in the first half of 2025, per Kerrigan’s report a year ago, so the half-year count is flat and the twelve-month record comes from a strong second half of 2025. The next two reads are dated. The six public dealer groups report third-quarter results in late October and will show whether acquisition spending per dealership stayed at the record pace; Kerrigan’s third-quarter report follows around December. The surprise would be a trailing-twelve-month count below 462 while the index stays at 78% above 2019: that would mean the sellers stopped coming at the price the buyers are still willing to pay.
