Consolidation: Fewer Companies Operate Car Dealerships Every Year

The range of car dealerships in the U.S. remained rather secure in 2021, but less businesses personal them. Which is the summary Automotive News attained in its yearly examine of the dealership business.

Motor vehicle dealerships ended up when generally local businesses. But, now, significant conglomerates routinely run dozens of dealers, stretching throughout numerous states and selling vehicles of just about every brand name. AutoNation, America’s major dealership team, owns far more than 300 dealerships across 18 states and employs a lot more than 21,000 individuals.

The dealership business is progressively consolidating, with massive dealership teams obtaining out area functions.

A lot more Automobiles Marketed by Less Businesses

AN experiences that, in 2021, the ten biggest accounted for 9.3% of all new car or truck product sales nationwide – up from 8.5% in 2020. 2021’s whole may possibly even be an undercount – it does not account for gross sales by some dealerships obtained in the course of the calendar year.

The 150 biggest sold virtually a quarter of all cars and trucks and noticed their market share mature by much more than 1% final yr.

AN expects consolidation to carry on, noting, “Several dealers who acquired outlets in 2021 instructed Automotive Information more deals are in the cards for 2022.”

What it Suggests for You

For car or truck customers, the news has combined meanings.

On one particular hand, buyers can assume a more consistent experience from dealership to dealership. Substantial dealership teams may well have much more consistent policies and gross sales practices. As new automobile selling prices have risen in the course of the very last calendar year, some sellers have started introducing substantial markups to the price tag of new cars and trucks.

That has automakers pushing back again, with Ford, Typical Motors, Subaru, Hyundai, and Nissan all just lately warning their dealerships in opposition to shady pricing and leasing ways.

On the other hand, consolidation could rob buyers of the single most powerful software in their negotiating toolkit: neighborhood levels of competition. When threatened with a hefty markup, buyers can usually wander absent, assured that one more dealership in just a acceptable travel can offer them the identical automobile. That grows fewer and less legitimate just about every yr.

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