Average Throughput on Pace for Record Says Urban Science

Average Throughput on Pace for Record Says Urban Science

August 25, 2015 — As automotive sales continue to increase, the average sales per dealership — or throughput, to use industry vernacular — is on its way to a fourth consecutive annual record according to Urban Science’s 2015 midyear Automotive Franchise Activity Report.

The report projects that throughput will hit approximately 945 new vehicle sales per store if the industry finishes the year at an estimated 17.1 million sales. The number, to some extent, is skewered because it includes fleet sales. Urban Science calculates the throughput number based LMC Automotive’s forecast — which is 17.1 million overall new vehicle sales for 2015. Fleet sales typically make up about 20% of all new vehicle sales.

Urban Science breaks out throughput numbers based on retail sales for its clients but will not publish those numbers because none of the forecasting firms — LMC, J.D. Power and Associates, Wards Automotive, IHS Automotive — publishes a forecast that separates fleet from retail. Meanwhile, each manufacturer defines fleet differently making it nearly impossible to separate the two numbers. Add to that, not every manufacturer reports its fleet numbers, which adds to the complexity.

Factoring in 20% fleet sales, the average throughput on retail sales drops to 760 per dealership (although, some fleet sales are dealership driven). Nevertheless, most brands are experiencing a significant increase in the number of sales per dealership. (Urban Science doesn’t report the brand numbers publicly.)

Urban Science shows a slight increase in the number of automotive dealerships in the United States since the end of 2014. As of July 1, 2015, there were 18,011 dealerships (rooftops), a 0.3 percent increase from Dec. 31, 2014 total of 17,953. The number of franchises (brands a dealership sells) also increased slightly 0.3 percent - from 31,609 on Dec. 31, 2014, to 31,714 as of July 1, 2015. (PRNewsFoto/Urban Science)

Urban Science’s report also shows the number of new car dealerships in the U.S. has increased from 17,953 at the end of 2014 to 18,011 on July 1, 2015. The number of franchises (brands a dealership sells) also increased from 31,609 on Dec. 31, 2014, to 31,714 on July 1, 2015.

According to the report, states adding the most dealerships the first half of 2015 include: Texas – 10; California – 8; Florida – 7; and Iowa, Maryland, Michigan and Virginia – 5 each.

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