Consolidation: Fewer Companies Operate Car Dealerships Every Year

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The variety of car dealerships in the U.S. remained fairly stable in 2021, but much less corporations possess them. That’s the summary Automotive News achieved in its annual examine of the dealership sector.

Vehicle dealerships were after typically community companies. But, nowadays, substantial conglomerates routinely operate dozens of dealers, stretching across multiple states and advertising cars of every single brand name. AutoNation, America’s greatest dealership group, owns extra than 300 dealerships across 18 states and employs additional than 21,000 men and women.

The dealership field is progressively consolidating, with significant dealership groups shopping for out neighborhood functions.

Much more Autos Offered by Much less Corporations

AN experiences that, in 2021, the 10 most significant accounted for 9.3% of all new car or truck revenue nationwide – up from 8.5% in 2020. 2021’s overall may possibly even be an undercount – it does not account for revenue by some dealerships acquired in the course of the 12 months.

The 150 premier sold just about a quarter of all autos and saw their current market share develop by a lot more than 1% previous 12 months.

AN expects consolidation to continue, noting, “Several sellers who acquired shops in 2021 told Automotive News additional offers are in the cards for 2022.”

What it Means for You

For car or truck shoppers, the news has mixed meanings.

On one particular hand, consumers can expect a more regular working experience from dealership to dealership. Large dealership groups could have extra consistent insurance policies and sales methods. As new motor vehicle prices have risen throughout the last calendar year, some dealers have begun including considerable markups to the value of new vehicles.

That has automakers pushing back, with Ford, Basic Motors, Subaru, Hyundai, and Nissan all not too long ago warning their dealerships from shady pricing and leasing methods.

On the other hand, consolidation could rob purchasers of the solitary most powerful software in their negotiating toolkit: community opposition. When threatened with a hefty markup, buyers can often stroll away, assured that one more dealership in just a fair generate can sell them the exact auto. That grows fewer and less legitimate every year.

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