Lifestyle

International Nameplate Dealership Revenue Up 7% January Year-over-Year


AIADA-NCM’s iDealer Data today found that international nameplate auto dealers experienced a 7 percent growth in total dealership sales in January 2006 over the same month last year. Growth in new, used, and service and parts department sales increased total dealership sales by nearly $240,000 year-over-year.

Total sales at the average international nameplate auto dealership rose 7.0 percent in January 2006 over the same month in 2005 to about $3,681,000, according to the iDealer Data. The bulk of the sales growth came from growing new vehicle department sales, which rose $131,000, or 6.4 percent, to $2,163,000 year-over-year.

The new vehicle department’s sales growth was, however, not due to a rise in the number of new vehicles retailed, which was down slightly by 0.2 units to 72.6 new vehicles retailed. Moreover, the average new vehicle selling price at an international nameplate auto dealership is down $80 to $27,512 versus January 2005. The department’s sales growth accrued from a rise in one or a combination of the following: F&I, aftermarket sales, fleet sales and service contracts.

Net promotional expenses per new vehicle sold dropped 18.5 percent year-over-year to $295. It’s unclear whether the drop is due to higher per vehicle factory ad credits, or lower per vehicle promotional outlays at the dealership level. Dealers have been shifting ad dollars towards the internet, where have a higher potential for attracting and tracking customers with a high buying potential. Nonetheless, net promotion expenses per new vehicle retailed have fallen nearly every month since January 2005, which was the peak for 2005.

Dealers continue to chip away at their cost structure, finds the AIADA-NCM iDealer Data. The cost to sell a new vehicle at the average international nameplate auto dealership fell $175 from January 2005 to January of this year, a drop of less than 1 percent of from $26,205. However, in aggregate, this comprises a cost savings of just over $18,000, or about 1 percent of new vehicle department sales. Also, average new vehicle selling price has not fallen as fast at the cost to sell a new vehicle, which dropped $80 year-over-year to $27,512.

Used vehicle department sales also followed the trend of new vehicle department sales. While the number of used vehicles retailed in January 2006 was only slightly higher (by 0.3 units) than the number sold in January 2005, used vehicle department sales grew 10.2 percent to reach $1,030,000. However, unlike the growth in new vehicle department sales, used vehicle department sales can be in part attributed to higher vehicle selling price: the average international nameplate used vehicle sold for $684 more in January 2006 than January 2005. Higher selling price accounted for approximately one-third of this department’s sales growth. The rest can be attributed to a rise in one or a combination of the following: wholesale units, F&I, aftermarket sales, and service contracts.

Service and parts sales inched upwards 2.8 percent to about $488,000 in January 2006 over January 2005. This department’s sales were down 5.2 percent from December 2005, when service and parts department sales were $515,000 – among the highest in 2005.

The average international nameplate auto dealership employed nearly 3 fewer people in January 2006 compared with the same month last year. The average international nameplate dealership employed 65 people this January compared with 67.6 people last January. Despite the paring back of the work force, total employment expense per employee rose 8.1 percent year-over-year to nearly $3,000. Dealers point to rising healthcare costs as the main reason for rising employment expenses.

To view the full set of data, click here. To previous month’s releases and data sets, visit www.aiada.org/idealerdata.


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