Armstrong’s first move as his own boss was to get on a plane to Japan and buy 37 cars. On paper, it looks like the kind of leap that keeps most people at their day job. Armstrong didn’t experience it that way. He’d already worked in Japan for his previous employer and knew the agents and the process, so the risk that would stop most people never really registered for him.
There was no five-year plan behind the decision, and Armstrong doesn’t pretend there was one. He describes those early years as instinct more than strategy, building the business as he went rather than following a blueprint.
The first real test came in 1998, when an economic downturn tightened the used-import market Armstrong had built his business on. Rather than wait it out, he decided he wanted to be in the car business for the long haul, which meant moving into new vehicles, and the parts, servicing and dealership revenue that come with them.
His first new-car franchises were Peugeot, Jeep and Mercedes-Benz in Christchurch. The Mercedes-Benz dealership turned out to be the one that mattered most: sales tripled within a year, turning a business that had been hovering around break-even into a genuinely profitable one.
That success didn’t stay in Christchurch for long. Mercedes-Benz asked Armstrong to take on its Dunedin dealership next. He wasn’t keen at first. He took it on anyway, and the regular trips between the two cities taught him something a single-site owner never has to learn: how to run a business you can’t personally watch over every day.
Wellington followed, and then Auckland. Armstrong is candid that none of it was mapped out in advance. “Almost by accident,” is how he describes becoming a nationwide operator. Each new city added a layer of complexity that pushed him further away from hands-on control and further into building managers, processes and accountability he could actually trust.
The Auckland move that changed the shape of the business came in 2014, when Armstrong’s bought the former Giltrap City Toyota operation. It gave the group a high-volume brand to sit alongside Mercedes-Benz, and today Armstrong’s runs three Toyota dealerships in Auckland, including the large Mount Wellington site that also houses the group’s head office.
From there, Armstrong’s pushed further up the chain into vehicle distribution, taking on Peugeot, Citroen, Opel and Leapmotor. The thinking behind it comes down to one industry risk that keeps dealers awake at night: manufacturers deciding to sell directly to customers and cut dealerships out altogether, the way Tesla already does.
“That’s why I’ve had that ambition to be the distributor,” Armstrong says. Being the distributor puts Armstrong’s closer to the manufacturer and better protected if more brands decide to go direct.
The same logic shows up in the group’s property holdings. Armstrong’s owns many of the sites its dealerships operate from, a deliberate move to control one of the business’s most valuable assets. As Armstrong puts it, “If you’re a retailer, location is everything.”
If there’s one shift that has changed the industry Armstrong entered in the 1990s beyond recognition, it’s the arrival of Chinese manufacturers, something he first saw coming on a visit to China several years ago.
“My eyes were just wide open at what we saw because unless you’ve been there, you’re not going to believe it,” he says. “The scale of it, the supply chain efficiencies, the technology, styling, quality, comfort. The tech thing was the biggest bit.”
On a more recent trip, Armstrong took his chief financial officer through one of the country’s newest factories. “They literally build the cars. The brand-new ground-up factories are just enormous. There’s randomly a few people, but not many.” Some of these plants, he says, are running at only around half their potential output, with plenty of room to scale up. “If they had to, they could just keep building them for 24 hours a day.”
The impact of that visit stayed with him. “When I saw that the first time, about three or four years ago, I knew that the war was won. It was game over. They were coming regardless.”
For an established dealer group, that leaves one real option: adapt. “We’ve basically backfilled our showrooms with Chinese brands throughout the country,” Armstrong says, while being realistic about what it means for the wider market. “The actual outright volume’s not growing, so they’re just gnawing into other people’s share. There are going to be winners and losers.”
Chinese competition isn’t the only force reshaping the industry. Electric vehicles are changing what customers buy and how dealerships need to operate. “The car industry is going through a massive state of change. You’ve got to be quick on the game to follow it,” Armstrong says. EVs, hybrids and plug-in hybrids bring reduced servicing needs, he notes, but they also demand charging infrastructure dealerships didn’t need a decade ago.
The way cars are bought and sold has shifted just as much as what’s under the bonnet. “We’ve got them on Trade Me. We’ve got digitalisation,” Armstrong says. That shift is most visible in Armstrong’s Auction Online, launched in 2019 and now running three online auctions a week for dealers, fleets, rental companies, finance companies and manufacturers, with more than 1,700 registered users.
The newest addition is a finance business, launched this July with 25 finance specialists offering everything from car and personal loans through to business lending. Armstrong describes the broader strategy simply: a business built to “self-feeds into and out of the car business,” where each part of the group supports the others.
Running a business across four cities requires a completely different approach from the one Armstrong started with. He can no longer be on-site to make every call himself, and he’s had to learn to lead through people and process instead. “As you get bigger and older and smarter, you use your head and [learn you must] have process, policy and discipline in your business,” he says.
Armstrong is quick to push back on the idea that the business is about him. What has surprised him most, he says, is the team he’s built around him and the loyalty and commitment they’ve shown over the years. As the business grows, he sees the real challenge as finding the right people, giving them genuine responsibility, and holding everyone to the standard he expects of himself.
Looking ahead, Armstrong expects the market to keep consolidating, with scale, resources and process becoming harder for smaller operators to match. That doesn’t mean he’s slowing down. “We’re growing still. We’ve got opportunities. We’re exploring,” he says.
It’s easy to forget, given the scale of the business today, that Christchurch was an unlikely place to start something that would end up nationwide. Armstrong is the first to say it wasn’t planned that way. He simply took opportunities as they came, first Dunedin, then Wellington, then Auckland.
Looking back, he thinks starting in Christchurch may actually have worked in his favour. “If you started in Auckland, you wouldn’t bother going to Christchurch or Dunedin or Wellington. Auckland was already a big enough market to keep a dealer busy,” he says. “By virtue of my starting down in Christchurch and navigating my way here, by mistake we became a nationwide company.”
The Canterbury connection hasn’t faded. Armstrong still has family in Christchurch, some staff have been with the business for more than 30 years, and he describes trips back as “super-familiar,” always looking forward to catching up with the team. He’s also honest that he’d like to see more from the region, saying he’s disappointed the business hasn’t grown enough in Christchurch and wants to see it expand further there.
Thirty-three years after flying to Japan for 37 cars, Rick Armstrong is still building. The next chapter of the Armstrong’s story, by his own account, still has Canterbury written into it.
While Armstrong’s started with just 37 cars, we now offer over 1000. Discover the full range of vehicles now.
Read the NZ Herald article here
