Matthews Automotive Group in late March acquired Sylvester Chevrolet in Peckville, Pa., from the Sylvester family. The transaction reflects the difficulty of operating as a single-point dealership amid the growing complexity of the retail automotive business. It also illustrates the synergies that being part of a larger group can bring.
“We just have more resources than a single store can have,” Rob Matthews, the group’s CEO, told WardsAuto on a phone call. “And so, when we were looking at (acquiring Sylvester Chevrolet), we just thought there was going to be some really upside potential.”
Matthews plans to boost online and other forms of marketing and include the new store in his group’s centralized Business Development Center outreach and internet support, he said.
It also enhances the Matthews name in the area. Matthews Kia of Blakely is only a few miles from the Chevrolet store, Matthews said, and adding another Matthews dealership in the area is extra exposure for the brand. Peckville is a village within the larger borough of Blakely.
The dealership facility is image-compliant, which “100% made the deal more attractive,” Matthews added.
The sale of single-point dealerships or small groups to a larger regional group such as Matthews Auto is a trend, Talon Fee, managing director of the Dave Cantin Group, which represented Sylvester in the deal, told WardsAuto on a phone call.
Such “regional consolidators,” often privately held groups, are very focused on a specific geography, Fee said, because of the synergies they can achieve in marketing and resource sharing.
Matthews Auto Group, headquartered in Vestal, N.Y., now includes 16 rooftops, according to Matthews, representing most domestic brands and many import brands. The dealerships are spread across Pennsylvania and New York state. Matthews Chevrolet of Peckville, as the newest acquisition is now known, is the group’s second Chevrolet store.
Matthews said the group plans to continue to expand, though any acquisition outside of New York or Pennsylvania should be a four- or five-store group to “allow us to have a presence right away.”
Love at first sight
Matthews replaced the Chevrolet store’s general manager but kept all the remaining staff, he said. Indeed, Derek Sylvester, the former owner, and his two daughters and nephew will continue to work at the store.
Sylvester said he will be the “transition coordinator,” selling cars to his former customers and being a liaison.
It didn’t hurt that when Matthews and Derek Sylvester met, they really hit it off, Sylvester said. The two didn’t actually meet until he had agreed to sell the store to the Matthews Group, Sylvester said.
“Then, after we met, it was, you know, love at first sight, I guess,” he said. “We really like everybody on his team.”
Shrinking market share
The decision to sell the store, which his father founded, was a family decision, Sylvester said. Though his wife, brother, nephew and two daughters worked at the dealership, the store was just too small to continue to thrive, Sylvester, 67, said.
General Motors, which owns the Chevrolet brand, doesn’t have the market share it did when he took over the store, Sylvester said.
“I don’t see my kids being able to keep it together like I did when my father gave it to me,” said Sylvester, who says he sold his first truck in 1978.
GM in the 1970s held more than 40% of the U.S. vehicle market. That has shrunk to around 17%.
Shrinking market share notwithstanding, Chevrolet is a “fantastic” brand in northeast Pennsylvania, Fee said. Fee knew the Sylvester family from his nearly decade of work at GM before joining the Dave Cantin Group, he said.
When Sylvester read that Fee was now with the Dave Cantin Group, the two began chatting about Sylvester’s long-term vision for his dealership. “It ultimately got to the point where Derek and his family decided it was the right time for them to exit ownership,” Fee said.
Sylvester figures he actually waited a bit too long to pull the trigger on selling. “I should have done it two years ago,” he said. “I would have got more money.”
