While auto dealership M&A in the first quarter was down year-over-year, buy-sell momentum is building and there is “plenty of opportunity” in coming months, according to The Presidio Group, which anticipates a “very active M&A environment” the rest of the year.

The firm’s latest report, Presidio Perspectives: A Quarterly Outlook on Auto Retail and M&A Trends, estimates there were 82 dealership buy-sell transactions involving 106 stores during Q1.

A year ago, there were 90 transactions, with 175 dealerships involved.

Election season was in full tilt in summer and fall 2024, naturally leading to regulatory/business environment uncertainty. That, Presidio said, likely led to fewer deals closing in early 2025. But there has been a rebound in buy-sell momentum, including within Presidio’s pipeline, which it described as “robust.”

The company is anticipating an acceleration of deal closings during the summer and fall of this year.

“The appetite for well-positioned acquisitions remains robust,” Presidio president George Karolis said in a news release. “We expect that acquisitive dealers will have plenty of opportunity to add to their portfolios through the remainder of 2025, driving further consolidation in the industry.”

Tariffs, of course, can complicate matters — broadly speaking.

But despite “new uncertainties” with the Trump Administration going back-and-forth on tariff policies, there may actually be opportunity.

“Tariffs make brand consideration even more critical — dealers could shift their approach on buying stores representing certain brands based on where their new-vehicle inventory for the U.S. market is being sourced,” Presidio said in the report.

Karolis added: “Most dealers we speak with are looking past tariffs as just another hurdle in a long history of navigating market risks and opportunities. It could even present opportunity as many view the announced policy as a negotiating ploy that could lead to stable ground in the long term and potentially energize the market in the near term. The underlying health of the industry is evident with more buyers than sellers in the market, and we see positive momentum in our pipeline.”

In its report, Presidio shared the perspectives of public dealer groups on how they see tariffs impacting M&A.

That includes Lithia & Driveway CEO Bryan DeBoer, who said there wasn’t any major effects, just slower activity in recent months.

“We operate within one of the largest and least consolidated industries. Our ability to be the most competitive acquirer and an efficient operator is a core strategic advantage, one that positions us to grow profitably,” DeBoer said, as quoted in the Presidio report. “…We’re still looking for that more major meaningful acquisition at some point in our lives and believe that the industry can be consolidated and one plus one can truly equal three.”

Sonic Automotive Jeff Dyke was quoted in the report, as well, saying of tariffs: “Certainly, it’s come up. If anything, maybe we’re buying a little bit of time just to see what happens over the next 90 days before we finalize some transactions.”