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Lithia Motors Inks Strategic Deal With E-commerce Retailer

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Lithia Motors, Inc. (LAD - Free Report) has inked a strategic partnership with San Francisco-based e-commerce retailer, Shift. The underlying idea is to capture majority of used vehicles — above 40 million to be specific — sold in the United States per year and use more technology for simplifying the car buying and ownership experience. Such an alliance will allow both companies to collaborate with respect to technology, inventory, data, business and physical network.

Notably, Shift is the largest used car retailer in San Francisco and operates all over California. The company is anticipated to sell around 8,000 vehicles during 2018. While leading automotive retailer Lithia Motors deals in new and used vehicles plus related services in the United States. Shift’s dynamic operational capabilities and technology platform are likely to well complement Lithia Motors’ culture of creating a digital marketplace as well as its timely provision of a decent retail experience to its customers.

Additionally, Lithia Motors will be the frontrunner in Shift’s Series D fundraising round. The former will invest $54 million to become the latter’s largest shareholder.
 
Over the past three months, shares of Lithia Motors have underperformed the industry it belongs to. The stock has declined 16.3%, wider than the industry’s decrease of 3.8%.


Zacks Rank & Key Picks

Lithia Motors currently carries a Zacks Rank #4 (Sell).

A few better-ranked stocks in the auto space are Fox Factory Holding Corporation (FOXF - Free Report) , AB Volvo (VLVLY - Free Report) and PACCAR Inc. (PCAR - Free Report) . While both Fox Factory Holding and AB Volvo sport a Zacks Rank #1 (Strong Buy), PACCAR carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Fox Factory has an expected long-term growth rate of 16.8%. Over a year, shares of the company have soared 67.7%.

AB Volvo has an expected long-term growth rate of 15%. Over the past two years, shares of the company have surged 46.6%.

PACCAR has an expected long-term growth rate of 10.8%. Shares of the company have risen 6.3% in the past six months.

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