Car dealer Armstrong's to use Botany as springboard for growth

An artist's rendition of Armstrong's new dealership at 257 Te Rakau Drive. Photo/Supplied

Armstrong's, one of New Zealand's biggest privately-owned automotive groups, says it plans to build three new car dealerships in Botany to boost its long-term growth aspirations for Auckland.

The company, which earlier this year planned an Initial Public Offer (IPO) and sharemarket listing before market conditions took a turn for the worse, said the "significant" capital investment reflected almost five years of strategic property acquisitions and planning.

In 2014 Armstrong's launched in Auckland with Auckland City Toyota in Grey Lynn and Mt Wellington, followed by Greenlane.

"At this time we identified East Auckland was being severely under-serviced, and Ti Rakau Drive stood as a natural transport nexus," group chair Mark Darrow said.

"We saw an opportunity to start laying the foundations to one day become New Zealand's leading automotive dealership group."

By 2017 Armstrong's had opened dealerships for Mercedes-Benz and Hyundai, followed closely by Nissan, Peugeot and Citroen in 2020.

"As this strategy continued to deliver strong results, we acquired two more properties - where in 2022 we're now moving to develop 257 Ti Rakau Drive," Darrow said.

Armstrong's operated what it believed to be the premier automotive precinct in East Auckland - representing Mercedes Benz, Hyundai, Nissan, Peugeot and Citroen, with other brands in the pipeline.

Chief executive Troy Kennedy said the company would represent Mazda in Botany in late 2023.

Armstrong's, founded in 1993, operated 16 dealerships and represented 18 global automotive brands in the Dunedin, Christchurch, Wellington and Auckland markets.

In January, Armstrong's announced it would relocate its existing Toyota Mt Wellington operations to a newly leased two-hectare site at 8 Forge Way in Mt Wellington, previously occupied by Fleet Partners.

The site would be used to house an expansive Toyota dealership for Auckland City Toyota, which is currently situated on a smaller neighbouring site.

Early in the year, Armstrong's was conducting a pre-IPO roadshow with institutional investors, pitching itself as the only consolidator in the New Zealand market of scale.

But by March, market conditions gave the company cold feet.

Kennedy said at the time "market turbulence, macro-economic conditions and geopolitical events" were behind the decision.

Armstrong's latest expansion plans came at a difficult time for the new car industry.

The Motor Industry Association (MIA) has blamed high living costs, fuel prices, supply choke points and a weakening economy for dismal July sales figures.

MIA said new passenger car and SUV registrations were down 19.4 per cent on the same month last year.

It was even more dire for new commercial vehicles, with registrations down 39.8 per cent on July last year.

Overall, registrations of new vehicles were down 26.3 per cent on July last year, MIA said.