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Projection: New Car Sales Decline, Dealerships on the Rise

February 15, 2018 0 Comments

The new vehicle sales projections for 2018 follow a general trend: the numbers are set to decline following a record number throughout 2016.

Dealership throughput, the average number of new vehicles sold per dealership, is also projected to decline for the third year in a row.

The estimates have dealership throughput at 920 new vehicles sold per dealership this year, a 2.9 percent decline from 2017 (947 new vehicles per dealership). Last year’s numbers were down 1.9 percent from the year before (965 new vehicles per dealership), a single unit down from a new record of 966 new vehicles sold per dealership in 2015.

While dealership throughput is on the decline, the number of dealerships in the U.S. is on the rise. At the beginning of 2017, there were 18,170 dealerships in the U.S. At the beginning of this year, there were 18,213 dealerships nationwide.

It isn’t a huge increase, and 97 percent of local U.S. markets saw no change in dealership numbers. Other areas of the country are getting new dealerships more rapidly. Texas gained 15 new dealerships last year, Florida gained 11, and Pennsylvania gained 10.

The increase in dealerships could get a boost from “rumored newcomers” like China’s Guangzhou Automobile Group and the French automotive brand PSA. Guangzhou is planning a U.S. launch for its Trumpchi brand, while PSA hopes to enter the U.S. market as well.

“As it stands right now, for the past several years, it has been a slight increase — like 30 [or] 40 per year — in the number of rooftops,” Mitch Phillips, global data director at Urban Science, told Automotive News. A couple of brands that have planned to come in, in the next several years, might increase the number of rooftops or keep them stable as they use existing stores.”

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