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New-car dealerships increase in U.S.

September 2, 2011
The national head count of new-vehicle dealers registered its first uptick in a decade in the first half of 2011, with 66 more joining the race.
The increase—to 17,725, or 0.4 percent more—represents the end of a series of precipitous declines in dealers in recent years after the bankruptcies of two U.S. automakers and the shedding of numerous brands. The United States had 20,000 new-vehicle dealers in 2008.
Metropolitan-area dealers increased their number by 0.7 percent, while dealerships in rural areas fell by 0.5 percent. About 13,500 of the dealers are in metropolitan or urban areas, with 4,200 in rural areas, according to a report by Detroit-based Urban Science.
“The small but unusual bump in the number of dealerships can be attributed to market corrections as the automakers rearrange stores following a couple tumultuous years of network consolidation and dealership bankruptcies,” said Urban Science’s John Frith.
The report also reported an increase in average sales per dealer, suggesting dealers are in financially stronger positions than they were at the close of 2010, from an average 656 sales reported last December to 711 units now.
Automakers have reported that a higher percentage of their dealers are profitable.