Go Auto has gone Hollywood, acquiring Toyota of Hollywood, a Los Angeles dealership on Sunset Boulevard with a history dating back nearly seven decades.
The Alberta-based dealership group announced this week that it has purchased the store, which opened in 1957 and is recognized as Toyota’s first dealership in North America. The acquisition gives Go Auto its eighth U.S. dealership since it began expanding south of the border in 2023 and its third in California.
Overall, Go Auto now has six Toyota stores among its 70 North American dealerships and represents 26 brands.
“It’s a very special, unique store because it is the very first Toyota store in America,” said Jared Priestner, CEO of Go Auto. “It’s where Toyota dropped its roots.”
The dealership’s Hollywood connections extend beyond its location. An episode of Curb Your Enthusiasm was filmed there, with creator Larry David playing the role of a hilariously inept car salesman.
Priestner said Go Auto had been working on the acquisition for six to nine months.
Go Auto President Phil Abram said the history surrounding the dealership was one of the things that made the acquisition particularly appealing.
“Any time you can find something that has seven decades of experience in the marketplace, it comes with a lot of feelings,” said Abram. “We’re incredibly excited about it, and honestly we’re excited about the marketing campaign behind it, all the cool stories that must exist that we can’t wait to find out more about. All those bits and pieces really add to the culture and build on what that store could be.”
Beyond the history of Toyota of Hollywood, Priestner said there are several things that make U.S. dealerships attractive to Canadian groups, including the opportunity to operate larger-volume stores.
“Typically in the States the throughput per location is significantly larger, and in California you have 10 miles of protected market area, which combined with the population density gives you a formula for sales that’s hard to match elsewhere,” said Priestner.
He said the U.S. also offers a more favourable vehicle-allocation environment.
“In areas of Canada where we struggle to get popular or high-volume inventory, a lot of the time they are feeding the States,” said Priestner. “For instance, you can actually walk into a Toyota store in the States and see some inventory, where in Canada it’s almost like you are pre-ordering every car. The plentiful inventory supply is another thing that attracts us.”
Priestner said Go Auto’s move into the U.S. was also driven by a desire to test whether its operating model could compete successfully in the larger American market.
“That’s a big reason why we took the plunge in the first place, and once we started making deals and putting in our systems, we had some great success and realized we could definitely compete and thrive in the market,” said Priestner. “That’s why we decided to make the subsequent investments.”
Go Auto entered the U.S. with the acquisition of a dealership in Bellingham, Washington, near the Canadian border.
“Going in, we really didn’t know what it was like in the U.S., and we were probably overestimating how different it would be selling cars in America versus Canada, so Bellingham was probably the most Canadian-like,” said Priestner.
“It’s just a stone’s throw across the border. We had 17 stores in Vancouver to support it. That’s why we went to Washington first, to be as close to our home base or hub as we could, and then we went to California after we had a couple of years of success and I kind of learned the ropes.”
The expansion isn’t stopping with Toyota of Hollywood. Priestner said Go Auto expects to close on two additional California dealerships in October.
Abram’s LinkedIn post announcing the Toyota of Hollywood deal also generated discussion about the growing role Canadian dealership groups are playing in industry consolidation.
Safwan Choudhry, a Senior Account Executive with Tekion, described the deal as a milestone extending beyond the automotive industry.
“Truly proud moment to see Canadian pedigree making landmark moves in the epicentre of the world’s biggest market,” posted Choudhry.
Colin Richardson, Principal, Omni-Channel Automotive Solutions, said the acquisition comes as several large Canadian dealer groups continue to pursue stores and dealership groups, while succession challenges create opportunities for buyers.
“We expect to see a few substantial Canada-based groups trade hands soon, along with smaller B-market dealerships ongoing for the foreseeable future,” posted Richardson.
He identified Go Auto, Dilawri, OpenRoad, Lithia & Driveway, Steele Auto and CanadaOne among the groups to watch as buyers.
“(The) next five years will see plenty of action,” Richardson posted.
