Hitchcock Automotive sold its remaining three Toyota dealerships in February 2022 after the passing of its legendary founder, Frederick “Fritz” Hitchcock. Toyota of Santa Barbara and Northridge sold to Van Tuyl Companies and Puente Hills Toyota sold to Kaminsky Automotive. Kerrigan Advisors represented Hitchcock Automotive in the sale and had the opportunity to interview Ted Hitchcock, son of founder Fritz Hitchcock, and Howard Hakes, President of Hitchcock Automotive, after the sale.
Why did you decide to sell Hitchcock Automotive?
Howard Hakes: At the beginning of 2021, we had no intention of selling Hitchcock Automotive. Fritz, Ted, and I were enjoying the business and believed the next few years would be incredible for auto retail. But tragically Fritz passed away unexpectedly last August and that changed everything. His estate plan stated we should sell the stores in the event of his passing, so we proceeded down that road.
Ted Hitchcock: This was a very difficult decision for me and my family. The passing of my father, a legend in the car business and the founder and patriarch of Hitchcock Automotive, was devastating. I was born and raised in the car business, working alongside my dad. To suddenly sell the dealerships after his passing was one of the hardest things I have had to do in my career.
Fritz Hitchcock was a visionary and a leader in our industry. In choosing a buyer for the Hitchcock dealerships, what factors did you consider?
Howard: Fritz was a car dealer’s car dealer – he did not just care about his own stores, he cared about the industry, and he gave back to the industry that he loved every day. His mission in life was to make the car business as good as it could be. He truly lived the motto that the customer comes first, and he also believed passionately in treating employees well. As you can imagine, picking buyers that would continue Fritz’s legacy of exceptional customer and employee service was of the utmost importance to Ted and me.
Ted: While it would be hard to fill my dad’s shoes in the business, we were happy to see Larry Van Tuyl, another legendary car dealer, acquire our Santa Barbara and Northridge Toyota stores. My dad always admired Larry and his success in the car business, and we felt he would be an excellent steward of those stores. Also, we have known the Kaminsky family, who acquired our Puente Hills Toyota store, for decades. The late Bob Kaminsky was a close friend of my dad’s and I know he would be pleased to know that Bob’s sons, Greg and Gary Kaminsky, are now the owners of that store.
What do you think will be the biggest challenges for private, family- owned and operated dealership groups over the next decade?
Ted: As these businesses become more valuable, it is harder for family- owned groups to acquire them, particularly top franchises like Toyota. I think we will see more consolidation with larger groups owning a larger percentage of the market, particularly in major metro areas.
Howard: With the big auto groups getting bigger, I think it will become a harder business for the single-point dealers in the future. I expect more families, like ours, will decide to sell rather than try to navigate the changes coming to the industry, especially if valuations stay so high.