News from NADA

That's the National Automobile Dealers Association. They've compiled and printed their latest stats on dealership sales, and I thought I'd share them with you. This reflects how some of your competition fared through most of 2007.
Average Dealership Sales: Up 4.5% in total sales through 9/07, however, there was a net decline of 250 dealers. Also, total dealership gross sales grew more than 5%, with net profit before taxes of 1.8%
Dealership Expenses: Grew by 5.2%. Service and parts absorption remained at 52%, same as previous year.
New-vehicle Profits - even though sales of new units improved during the third quarter, retail gross profit fell 2% through September, to 5.1%. Now, where do you think the dealership will turn to make more money in 2008?
Used-car Sales: Revenue was up 6.2%, and operating profit increased 2% from the same period in 2006.
Service and Parts: Strong, strong sales through September, up almost 6% from the previous year. How do you compare? Are the dealerships taking service business away from you? What are you doing to combat the competition? Service and parts accounts for nearly 70% of the dealerships operating profit, up 2 points from 2006. I have to ask again, where do you suppose the dealerships will be looking for more sales/profits in 2008? That's right - they'll be looking at your business and doing what they can to take it away from you. Their operating profit on service and parts sales was almost 3% greater than in 2006. How does your rate?
Total Customer Sales per Repair Order: These were up 2%, and warranty work was up 2.5% from 2006. European and Asian models continue to maintain higher dollar rates than domestic repairs. Average warranty for European models was $379, $231 for Asian, and $206 for Domestics. When the customer paid the bill (instead of the insurance company) the typical repair order wa $441 for European, $199 for domestic, and $187 for Asian.
For 2008 - I hope you are able to concentrate on ways to improve your market share, increase your profitability, and have fun doing it. Best wishes for a prosperous new year!