Business Wire has released a new report on just how important car dealerships are to our national economy. The report discloses that 45,000 new and used dealerships across the country account for $600 billion in annual revenue.
The report goes on to say that new vehicle sales account for half of all industry revenue. Pre-owned vehicles make-up 30 percent, and parts, accessories, finance plans, extended warranties, and insurance account for some of the remainder.
According to Business Wire, the retail car industry is fragmented. The top 50 companies generate less than 15 percent of total revenue. This fragmentation exists despite the fact that there continues to be some big players with deep pockets in the retail car industry.
Some of the larger companies vying for consumer dollars are:
- Penske Automotive Group
- Sonic Automotive
- Hendrick Automotive Group
These large chains of retail car dealerships have significant advantages, including a wider selection of vehicles and cost-advantages when marketing, purchasing, and financing that inventory. Yet, the big boys face stiff competition from smaller “mom and pop” dealerships, as well as independents and even private sellers.
Small auto dealers can off-set the advantages the big guys have by stepping up to the plate with:
- superior customer service
- focusing on local conditions and local markets
Private sellers use the Internet to bypass normal and costly marketing channels.The full report, Research and Markets: Updated 2011 US Report for the $600 Billion Automobile Dealerships Industry, is available at BusinessWire.com.