The total number of dealerships in the U.S. fell by only 52 in 2018, according to an Automotive News survey, to 18,275. It seems the market can support that many – throughput was up slightly in 2018 to 533 units on total sales of 17.3 million.
Those dealers will have to use all their marketing skills this year, however. Sales for the first two months of 2019 fell more than two percent compared to the same period in 2018. They have seen much worse times, however, and I have confidence they will find ways to cut costs and boost fixed ops income and F&I to maintain their profitability.
Vehicle service contracts are often a great source of income for a dealership. This week, Don Ray returns to our pages with a look at two different profit-participation programs for such F&I products, and their relative strengths. Retro or Re-insurance? Read his column to see which side he falls on.
Though dealerships are still doing a healthy business, most dealer principals recognize that their customers’ mobility needs are evolving. At NADA in San Francisco I met with the folks from HyreCar, a Los Angeles-based startup, to learn about their platform that allows dealerships to utilize used car inventory by renting it out to owners who want to work in the ride sharing sector. I’m not endorsing their program over any other – and there are others. Read about it in this issue and let me know what you think.
And of course we have Transaction News.