Sales, jobs and optimism rise at new-car dealers

By Jerry Hirsch Los Angeles Times

LOS ANGELES — New-car dealers are adding workers, opening more stores and expressing general optimism about their business, according to an annual report released this week by the National Automobile Dealers Association.

The number of workers employed at new-car dealerships rose 4.6 percent in 2011 to 933,500, according to Paul Taylor, chief economist of the trade group.

The number of dealerships, which has declined dramatically in recent years, has started to climb, growing by about 66 on a net basis to about 17,600.

Still that’s down from more than 21,000 prior to the recession and the recent U.S. auto industry restructuring.

“The arrival of new brands and new dealerships is a sign that even more vigorous competition is on the way in the U.S. vehicle marketplace,” Taylor said. “As new brands enter the U.S. market, the net dealership count may increase in future years of strong economic growth.”

Dealerships in 2011 employed an average 53 workers, with an annual payroll of $2.6 million. Average dealership sales rose 12.3 percent last year to about $35 million.

Only 8 percent of dealers surveyed in March of this year expected their profits to decline in 2012. That reflects a general optimism in the industry. Only last year, when the figure was at 6.7 percent, did fewer car dealers expect profits to decline at any time in the past 10 years.


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