1997 NADA Data Points to Strong Dealership Performance
7 August 1997
1997 NADA Data Points to Strong Dealership Performance
WASHINGTON, Aug. 7 -- The nation's franchised new-vehicle
dealers added 34,700 employees to their payrolls in 1996, bringing total
dealership employment to over 1 million people and total payroll to
$35 billion, according to 1997 NADA Data. Dealership expenditures, excluding
cost of goods sold, reached $60 billion in 1996, boosting local economies in
the communities they serve. The report, based on the exclusive franchised
new-car and truck dealership data base of the National Automobile Dealers
Association, is published as an insert in the August issue of NADA's
Automotive Executive magazine.
Other findings of the report:
-- The average selling price of the typical new vehicle rose to $21,750
in 1996. Light-duty trucks, minivans and sport-utility vehicles
accounted for a record 44 percent of all new-vehicle sales. Most
import brands boasted a rise in market share; Chrysler Corp. was the
sole Big Three company to see an improvement.
-- The average used-vehicle transaction price reached a record $11,600 in
1996. Dealers obtained 65 percent of used units retailed from
trade-ins on new- and used-vehicle purchases. Auctions supplied 26
percent, up from 17 percent ten years ago.
-- Dealerships sold 15.1 million new vehicles, up from 14.8 million in
1995. Used-vehicle sales reached a record 19.2 million, as
dealerships sold more used cars than new for the eighth consecutive
year.
-- The new-vehicle department contributed 58 percent of total dealership
sales dollars, compared to 67 percent ten years ago. The used-vehicle
department contributed 30 percent, the service and parts department
12.4 percent.
-- Service and parts sales increased 8 percent, double the rate of growth
in 1995. Dealerships completed 221 million repair orders in 1996, for
total sales of $61 billion. More than half of all dealerships now
offer evening or weekend hours in the service department.
-- Dealerships increased advertising outlays by 10 percent in 1996, to a
record $5.1 billion. The lion's share of the increase went to
used-vehicle advertising, which accounted for 33 percent of all
advertising expenditures last year. More than half (52 percent) of
all dealership advertising dollars were spent on newspaper ads,
followed by television (17 percent) and radio (16 percent).
-- Erosion in the total dealership count has eased over the past three
years; the current total of 22,700 reflects a net decline of only 50
dealerships in each of the past three years. The decline is
concentrated in dealerships selling fewer than 150 units per year,
which dropped in number from 13,100 in 1977 to 4,540 in 1997.
-- Total dealership sales rose to $500 billion in 1996. Net profit
before tax as a percent of sales was 1.5 percent at the average
dealership, up slightly from 1.4 percent in 1995.
-- The NADA Dealer Optimism Index, a reliable barometer of national
economic trends, fell slightly to 135 in April 1997 from its peak at
154 a year ago, reflecting dealer acceptance of a slowing economy and
expectations of somewhat lower consumer spending for the rest of the
year.
The National Automobile Dealers Association represents more than 19,500
franchised new-car and truck dealers holding nearly 40,000 separate
franchises, domestic and import.
SOURCE National Automobile Dealers Association