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New-car dealerships set employment record in 2016: new report

April 21, 2017
Employment, wages and payroll at U.S. new-car dealerships all continued to rise in 2016, according to a report released April 13 by the National Automobile Dealers Association.
 
New-car dealerships last year directly employed a record 1,131,900 workers, a 2.4 percent increase from the previous year, according to NADA Data 2016, the annual financial profile of new-car dealerships. 
"Total dealership employment has consistently risen every year since the Great Recession," said NADA Chief Economist Steven Szakaly. "In addition, hundreds of thousands of other local jobs are dependent on dealerships."
Employment and Payroll
On average, a dealership employed 69 workers in 2016, up from 66 in 2015.
Average weekly earnings of dealership employees also increased, growing by 2.6 percent from 2015. Total annual compensation now averages $69,000 per employee, giving dealership employees one of the highest average salaries of any industry. 
Average annual payroll was $65 billion, up 4.9 percent, or $3.9 million per dealership.
Dealership Financial Trends
Total dealership sales revenue, including new- and used-car sales (including F&I), parts, service and body shop was $995.6 billion in 2016, an increase of 6.1 percent from 2015. The average per dealership was $59.6 million.
The Top 10 states in dealership sales in 2016 were California, Texas, Florida, New York, Oklahoma, Pennsylvania, Illinois, Michigan, Ohio and New Jersey.
Average Dealership Profile 
 
Despite rising auto sales and back-to-back record sales in 2015 and 2016, net pretax profit at new-car dealerships as a percent of total sales has remained flat, hovering at 2.5 percent for several years. 
"The past seven years have been the longest period of new-vehicle sales growth since the 1920s," Szakaly added. "For 2017, we expect new light-vehicle sales to continue on a strong trend, ending another year above 17 million."
In addition to the Average Dealership Profile section, NADA Data 2016 now includes a new expanded financial profile section covering Domestic, Import, Luxury and Mass Market dealerships.
Service and Maintenance
New-car dealerships wrote 259 million customer repair orders in 2016, up 6.5 percent from the previous year. These orders included service, warranty and recalls.
"More and more consumers are choosing new-car dealerships for their service needs," said Patrick Manzi, NADA senior economist. "Express service, such oil changes, and non-warranty repair orders at dealerships, on average, increased by 10.9 percent and 4.2 percent, respectively, in 2016. This increase demonstrates that consumers value the expertise of the highly-trained and factory-certified technicians employed at new-vehicle dealerships." 
Other highlights from NADA Data 2016 include:
 
• The total number of new-car dealerships was 16,708, up 163 from 2015.
• A record 17,465,020 new cars and light trucks were purchased or leased in 2016.
• The average selling price of a new vehicle was $34,449, up 3 percent from 2015.
• The average selling price of a used vehicle was $19,866, up 2.5 percent from 2015.
• New vehicles sold per dealership on average was 1,045.
• Number of customers purchasing a new- or used-vehicle service contract was 43.7 percent, up 1 percent from 2015.
• New-car dealerships sold 14,968,206 million used vehicles, which accounted for 37 percent of all used vehicles retailed.
NADA Data 2016 was updated with completely re-benchmarked data and methodologies. Revisions and expansions within the Average Dealership Profile series influenced how dealership sales were calculated. As a result, data and figures from previously released reports will not be comparable to the 2016 report.
There are two versions of NADA Data 2016. One is a general overview of the retail-auto industry, with infographics that can be shared by print and broadcast news outlets as well as on social media. The other, more detailed version looks at each dealership department, employment and payroll, trends in dealership advertising, as well as the entire retail-auto industry.
To download either version of NADA Data 2016, visit www.nada.org/nadadata.
 
 

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