Dealership Throughput Expected to Slip for Third Year in a Row
While sales numbers are a decent metric for assessing volume, they don’t give an accurate representation of what’s actually happening at the dealership. Instead, the figure represents the number of models an automaker was able to move from the factory. Theoretically, a manufacturer could load up a bunch of trucks at the end of the month and count them as “sold” to bolster volume — whether or not real people actually bought them.
Dealer throughput is better for assessing the current consumer climate. But we’re sure you won’t be surprised to hear that it’s cold and only expected to get colder. U.S. dealership throughput, the average number of new-vehicle sales per dealership, is expected to slip 2.9 percent this year. That equates to a mean of 920 vehicles in 2018, down from 947 in 2017.
That could make this year the third consecutive decline in per-store sales, according to Urban Science’s annual Automotive Franchise Activity Report. However, it may be too early in the annum to start prognosticating the automotive industry’s doom.
One contributing factory to the last two years’ decline was the number of new dealerships. U.S. auto deliveries were actually up slightly in 2016, despite a very modest decrease in throughput. Unfortunately, volume for 2017 was down a bit and dealerships were cut a little deeper — going from an average of 965 cars to just 947.
With the number of stores inching up every so slightly at the start of this year, and new brands like China’s GAC and Europe’s PSA Group on the way, some dealerships could be in for harder times if the 2.9-percent decline in throughput ends up being accurate.
“As it stands right now, for the past several years, it has been a slight increase — like 30 [or] 40 per year — in the number of rooftops,” Mitch Phillips, global data director at Urban Science, told Automotive News in an interview.
While there has been some consolidation between brands, he noted, “a couple of brands that have planned to come in, in the next several years, might increase the number of rooftops or keep them stable as they use existing stores.”
Consumer advocate tracking industry trends, regulation, and the bitter-sweet nature of modern automotive tech. Research focused and gut driven.
More by Matt Posky
Latest Car ReviewsRead more
Latest Product ReviewsRead more
- Tassos Unlike Tim, I don't use this space as a wastebasket for ANYTHING BUT a proper used car.If you seriously need a car AND you are as destitute as Tim's finds imply, HERE IS A PROPER ONE FOR YOUR NEEDS:You can probably get it for only $4k, WITH Leather, Factory Navigation, plenty of room and a V6.https://www.cars.com/research/toyota-camry-2005/I even considered getting it myself as an extra reliable car.
- Jeff Of all the EV trucks I like the Rivian the best but I am still years away if ever from buying an EV.
- Kwik_Shift I definitely like the looks of the newest 300s over the Chargers.
- SCE to AUX "Should car companies shack up with tech giants in order to produce legible infotainment systems and the like? Or should they go it alone?"Great question(s).The River Rouge days are gone, where Ford produced whole cars out of raw materials entering the plant at the other end. Nearly everything is outsourced these days - sometimes well, sometimes disastrously.But the problem with infotainment systems is that they are integrated with the car's operation. VW has delayed entire products for issues with infotainment.For me, the question boils down to a contractual arrangement - who owns and maintains the code forever? Since more and more of the car's function is tied to the infotainment system, I'd argue that the car mfr needs to own it - especially the larger ones.Do mfrs really want to share intellectual property with Huawei just to fast-track some code they've managed themselves in the past?
- Kwi65728132 I always did like the styling of the 300C and it was on my short list for a new (to me) rear wheel drive, naturally aspirated V8 luxury sedan but I found a Hyundai Equus that was better optioned than any 300C I could find and for several grand less.