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Even in depressed economy, dealers important: NADA annual report

November 12, 2010

Despite 2009 being a tough year economically, auto dealerships remain a significant employer in thousands of communities around the country, according to theNADA’s annual state of the industry report.

"NADA DATA 2010," the dealer association’s latest comprehensive look at auto retailing, was released July 29.

"The payroll for all new-car dealerships was nearly $44 billion and represented about 13 percent of the nation’s total retail payroll," says Paul Taylor, the NADA’schief economist. "New-car and -truck dealers are significant contributors to their local economies, tax bases and civic and charitable organizations."

Average new-car and -truck dealerships employed 49 people with an annual payroll of about $2.4 million in 2009, according to the report.

Taylor says the recent recession caused a drop in revenue from service and parts, as well as new-car sales in 2009. Other numbers from last year:

• New-vehicle sales fell to 10.4 million units from 13.2 million a year earlier;
• Used-car values increased as the shortage of used units started to limit sales for used vehicles;
• New-vehicle sales revenue fells by 15.4 percent from 2008 while used-car revenue increased by 3.5 percent.
• The NADA Optimism Index, which reflects new-vehicle dealers’ optimism about profitability over the coming quarter, dropped below 80 in the third quarter of 2008 and stayed below that level through June 2009. It then jumped above 110 the rest of 2009. In past recessions, strong improvements in the index were followed by higher light-vehicle sales.