Charlotte's Sonic Automotive, a prominent auto retailer, has made a significant move by acquiring the Harley dealership in South Dakota, renowned for hosting the world's largest motorcycle rally for over 80 years.
Announced on Wednesday, Sonic Automotive Inc. revealed its acquisition of Black Hills Harley-Davidson, situated in Rapid City, South Dakota, the esteemed venue for the iconic Sturgis Motorcycle Rally attracting half a million bikers annually. Specifics of the transaction were not disclosed.
Recognized as a premier shopping destination for rally attendees, the South Dakota establishment holds significant importance in the biking community, as noted by Sonic.
This purchase marks the latest addition to Sonic's newly established powersports segment, anticipated to contribute $200 million in annual revenue this year, according to CEO David Smith during the earnings call. Smith expressed confidence in the growth prospects within this industry segment, valued at $34 billion.
This acquisition signifies Sonic's 13th dealership, following the procurement of Mancuso Powersports in Houston in August and Horny Toad Harley-Davidson in Temple, Texas, in January 2022. Alongside Harley-Davidson, Sonic's portfolio now includes esteemed brands such as Can-Am, Sea-Doo, Polaris, Kawasaki, Suzuki, Ducati, BMW, Honda, Indian Motorcycle, and Yamaha.
Smith emphasized the exceptional brand and customer loyalty associated with these stores and brands, characterizing them as top-tier establishments.
In its recent earnings report, Sonic disclosed record annual revenue of $14 billion in 2022, a 13% increase year-over-year, along with a record fourth-quarter revenue of $3.6 billion, up 13% year-over-year. Additionally, the company reported record fourth-quarter revenues of $589.3 million, a 2% increase year-over-year, and all-time annual revenues of $2.5 billion, up 5% year-over-year.
Sonic's strategic focus also extends to expanding its EchoPark Automotive segment, which offers discounted used cars aged one to four years, facilitating transactions through its website or retail outlets.
Notably, Sonic Automotive made headlines two years ago with its acquisition of Texas-based RFJ Auto Partners for $700 million, deemed one of the largest transactions in automotive retail history.
Established in 1997, Sonic stands as one of the largest automotive retailers in the United States, boasting 175 new and used dealership locations across 25 states, along with 17 collision centers, according to company reports.