When Andrew Habberstad heard that the owner of a Kia store in Huntington, N.Y., was thinking of selling, he was immediately interested. It fits nicely into Habberstad’s and his father’s goal of growing their dealership group and eventually passing it on to future generations.  

“We were really looking to grow our footprint on Long Island,” Habberstad told WardsAuto on a Zoom call.  

Acquiring the Kia dealership made “all the sense in the world” because it was only a mile away from their BMW dealership, also on Long Island, Habberstad said.

Habberstad Auto Group now includes the Kia dealership, two BMW dealerships, a Mini dealership and Huntington Powersports, all on Long Island. Andrew is CEO of the group; his father, Erik Habberstad, is chairman.

Erik Habberstad also operates used-vehicle dealerships in Florida in a 50/50 partnership with John Giasullo. Classic Cars of Palm Beach includes four locations, all on U.S. Highway 1.  

Adding Kia to the group’s new-vehicle franchises was a plus as it is one of the fastest-growing brands in the U.S. due to its competitive pricing, compelling design and above-average reliability and warranty programs, Erik Habberstad told WardsAuto in an email.  

The father-son duo are looking to add new-car franchises in New York and Florida, aided by Josh Barron, chief operating officer of Habberstad Auto Group.  

“Kia’s evolving lineup and modern brand presence give us confidence in local growth today and the ability to scale the Habberstad platform nationally in the coming years,” Barron said.  

The Kia dealership in Huntington was previously owned by Marina Letsios, who acquired the store in 2018, Habberstad said. The Letsios family “decided they wanted to focus on other projects,” he said.  

How the deal happened

A mutual friend told him the Letsios family was interested in selling but hadn’t listed the store, Habberstad said. Anonymity was important to them until they found a suitable buyer, the mutual friend said. 

Letsios and Habberstad are both board members of the Greater New York Automobile Dealers Association, so they already knew each other. 

Habberstad said he invited the owners to lunch and over two hours, they discussed “numbers for what the valuation would be on the franchise.”   

He had already examined the dealership’s financials, he said, and offered what he figured the dealership was worth, which wasn’t “too far off” what the sellers had in mind.  

“We said, ‘Alright, what if we just slice it right down the middle?’ And that’s exactly what we ended up doing,” Habberstad said. 

No broker was involved in the sale. “It was really quick and clean and easy,” Habberstad said.  

Over nine months they worked out the details, including valuing the furniture, fixtures and equipment, he said. The facility is already image-compliant. 

New owners ritz up the customer experience 

The Habberstad Auto Group plans to hire more service technicians and add service bays to Kia of Huntington. On the sales side, they will hire more salespeople and upscale the customer experience.  

The reason? The new owners wanted customers to feel the change of ownership “within 24 hours of buying the store,” COO Barron told WardsAuto in an email. 

“Removing friction in our sales and service process, increasing transparency and upgrading the customer waiting lounge is already having a positive effect on employee and customer satisfaction,” Barron said.  

Habberstad Auto Group hired three customer experience staff directly from the Ritz-Carlton hotel chain over the past two years, one of whom heads up customer experience, Habberstad said.  

The customer experience chief will now be at the Kia store bringing Ritz-inspired touches such as greeting customers in the lounge and offering them coffee or tea as well as including a gift for each customer.

The Kia dealership “was very much a mom-and-pop organization,” Habberstad said. “The areas they fall short are our strengths.”

Some 40 of the 50 staff stayed on, and they will be part of a much-changed operation.

A tech-forward transition is coming

Now that it is part of Habberstad Auto Group, Kia of Huntington will also see several new technologies introduced into its operations.

“We really lean into technology,” Habberstad said.  

The Kia store already used the Tekion dealer management system, which Habberstad uses across its group. So, the DMS transition is expected to be relatively easy. 

Habberstad will also bring in other technology, including Vincue inventory management software and the UVeye vehicle scanning system. 

Habberstad Auto Group is an investor in Vincue and UVeye, Habberstad said.  

“I want partners we can grow with and vendors with growth possibilities,” he said. “I am already poking at Tekion to invest in them.”

Habberstad said he frequently tells industry acquaintances that he is interested in investing in new auto retail technology. “I always need to be looking out into the future to identify trends before they happen,” he said. 

Habberstad Auto Group will soon have a website that includes all five of its new-vehicle dealerships. He aims to centralize functions such as accounting, the business development center and more, Habberstad said. “Even something as small as the license plate frames, those are all standardized,” he said.  

The stores on Long Island will share finance and service directors. “We are creating more of a corporate structure,” Habberstad said.  

Habberstad, 28, touts having the youngest dealership management group in New York, but “we are able to couple that with a parts director who has been with us for 30 years,” he said.  

What’s next for Habberstad Auto Group?

The group is looking to grow primarily in New York and Florida to ease the strain of too much travel. 

As for franchises it would like to acquire, “we love the BMW brand and would love to continue to grow with them,” Habberstad said.  

He is the third generation of his family to operate dealerships, and “it is my father’s dream to bring this to the next generation,” Habberstad said. 

In the late 1960s, his grandfather discovered the Habberstads’ first BMW store for sale for $10,000 in a newspaper advertisement, Habberstad said. “He was able to negotiate the price down with the guy, so I think he got it for around $7,000,” he said. 

Now, he and his father are excited about growing Habberstad Auto Group. “I’m 28. I have at least 30,40 years in me,” Habberstad said.