Shelly Automotive Group is on the move in every sense of the word.
It pounced on two deals last week, adding Jaguar of San Diego and Lexus of Riverside to its portfolio of luxury brands and about $150 million in sales to push its annual revenue to about $750 million.
“What we believe we are good at is selling luxury automobiles in the Southern California market,” said the group’s founder and chief executive, Damon Shelly, who also owns Shelly BMW in Buena Park and Mercedes-Benz of Long Beach. “These were two opportunities to get involved with two great brands within a drive from our head office in Irvine. It’s the same kind of customer that we’ve been serving for the last 27 years … so it seemed like a great fit for us.”
The Lexus acquisition included associated real estate. The business was owned by Dan Davidson, who died this year. General Manager Sandy Austell is staying on, as is the majority of her staff, Shelly said.
“It’s a healthy business, but we see a lot of opportunity to make improvements,” he added. “We got a plan.”
Jaguar of San Diego, which Shelly bought from David Murphy, also has growth potential.
“Our long-term plan is to build a new facility and be able to represent Jaguar and Land Rover,” Shelly said, referring to the two British-born brands, which often have been paired at dealerships since Tata Motors bought them from Ford Motor Co. in 2008 and formed Jaguar Land Rover Ltd.
The group’s other moves are more literal.
Its Rolls-Royce dealership in Newport Beach is heading south in coming weeks to new digs at the group’s headquarters in Irvine. Its Irvine BMW staff, meanwhile, will ditch construction trailers they called home for the past two years and head across the parking lot to the redesigned facility—just in time for Black Friday deals.
The south county “campus” also is home to the group’s Irvine MINI, which moved into a nearby stand-alone building in 2013. Shelly at about the same time bought the Rolls-Royce dealership from Newport European Motorcars and began planning “what the campus would look like” with another BMW-owned brand, said Steve Rudkin, the dealership’s general manager.
“The BMW group certainly would not let us put a Volkswagen franchise in the middle; it has to be part of what they consider their umbrella,” Rudkin said, adding that the group also wanted “better recognition” for Rolls-Royce, since “visibility [at the Newport Beach location] is very minimal. Here, there are 500,000-plus people a day that drive by us on the 5 Freeway.”
‘Ease of Management’
The group also was looking for “ease of management” with all three brands in one place, so it consolidated back-office functions.
The construction doubled the footprint of the building BMW once shared with MINI, requiring an investment of about $13 million. The upgrade was manufacturer-mandated and “done in the spirit of creating a better atmosphere for customers—much more welcoming, much more comfortable, less industrial, more personal,” Rudkin said.
The Rolls-Royce showroom fits about six cars. Last month Rolls-Royce Motor Cars Chief Executive Torsten Müller-Ötvös visited the nearly completed facility “and was very impressed,” Rudkin said.
BMWs will be sold under the same roof but in an adjacent hall with a capacity of about 18 vehicles.
The allocated showroom space is somewhat proportional to the revenue each brand generates—the group sells four to five Rolls-Royce vehicles each month at $250,000 and up each, while the BMW count can reach 450, with the luxury sedans and SUVs starting at about $30,000.
The upgrades come at the right time, Rudkin said, adding that “the South Orange County market is exploding, with the construction out on Bake and in San Juan Capistrano, everything south of us. I think there’s tremendous market opportunity.”
Porsche Dealer
The dealership, which is on Research Drive near the Irvine Auto Center, employs 240 and may be getting a luxury neighbor.
AutoNation Inc. plans to build a Porsche store on a vacant lot along the Santa Ana (I-5) Freeway near Scientific Way, according to Rudkin and permits filed with the city. It’s bought an “open point” that gives it exclusive rights to sell the brand in a specific geographic area—typically a 10-mile radius.
The Fort Lauderdale, Fla.-based chain’s effort to decouple its Newport Auto Center and move the Jaguar brand to the Mariner’s Mile area of Newport Beach hit a snag this month when the city’s planning commission rejected its proposal for a new 37,347-square-foot auto sales and service facility. It says it plans to appeal the decision.
Shelly, whose minority operating partner is Michael Chadwick, said he’s done with acquisitions for now, and plans to “digest what we have, make it better and do a great job for our customers and manufacturers.”
