agent Entrepreneur logo
MenuMENU
SearchSEARCH

New Car Dealerships Increase in U.S.

August 25, 2011
3 min to read


The number of new car dealers in the U.S. rose slightly in the first half of 2011, as the auto industry expanded in metropolitan areas, according to a report released Wednesday by Detroit-based Urban Science.


The increase — amounting to just 0.4 percent, with the addition of 66 dealers for a total of 17,725 across the U.S. — is the first reported uptick in a decade, the global retail consulting firm said. The increase represents the end of a series of precipitous declines in dealers in recent years after the bankruptcies of two U.S. automakers and the shedding of numerous brands, according to The Detroit News.

Ad Loading...


The firm said the number of metropolitan-area dealers increased by 0.7 percent, while dealerships in rural areas fell by 0.5 percent. About 13,500 of the dealers are in metropolitan or urban areas, with 4,200 in rural areas.


"The small but unusual bump in the number of dealerships can be attributed to market corrections as the automakers rearrange stores following a couple tumultuous years of network consolidation and dealership bankruptcies," said John Frith, vice president of retail channel solutions at Urban Science.


The dealer network in Metro Detroit was flat for the first half of 2011: 229 dealers, down one from Jan. 1.


The report, which covers Detroit's Big Three and all foreign automakers, also reported an increase in average sales per dealer, suggesting dealers are in financially stronger positions than they were at the close of 2010.


Average sales at dealerships have risen to 711 per dealership, an increase from 656 vehicle sales per dealership in December 2010.

Ad Loading...


Automakers have reported that a higher percentage of their dealers are profitable.


While the number of dealers went up, the number of franchises — the brands that a dealership carries — had decreased by 729 as of July 1, bringing that total to 29,360. Most dealers — 57 percent — have just one franchise at a dealership.


Urban Science said the decline in franchises is due largely to the wind-down of Ford Motor Co.'s Mercury brand at Lincoln dealerships.


This dip in franchises represents a major stabilization of the industry, following the closure of 4,897 franchises since 2009.


Paul Taylor, chief economist for the National Automobile Dealers Association, said dealers are seeing better financial performance — and noted new Fiat and Mahindra dealers will be selling cars soon.

Ad Loading...


"We will see a world in which there are more brands from a greater array of countries for sale in the United States," Taylor said. "New brands will be more important as they set up dealerships with new light vehicles from manufacturers in China, India, Italy and elsewhere who were not recent suppliers a year ago."


The U.S. had 20,000 dealers as of 2008, and has shed about 11 percent since then. Much of that reduction came as General Motors and Chrysler used their 2009 bankruptcy restructurings to shed hundreds of dealers.


Some automakers are trying to re-establish some dealerships in urban areas in places like California. High land prices and the shift of people to suburbs have resulted in some major metro areas having fewer dealers than automakers would like.


More Industry

Blue and white RV parked on beach facing the ocean.
Industryby Lauren LawrenceSeptember 3, 2026

RV Group Expands Carolina Footprint

Blue Compass RV Columbia Northeast is the 13th RV dealership owned by Blue Compass in the Carolinas.

Read More →
Photo of two men and one woman on a discussion panel
Industryby Hannah MitchellSeptember 1, 2026

Agent Acumen

An Agent Summit panel of people who’ve been supporting auto dealers for years gave both timely and timeless advice for those starting out or mulling the prospect.

Read More →
Gloved hand holding two wrenches next to “Turn Overdue into Opportunity” Graphic
Industryby Lauren LawrenceAugust 27, 2026

Missed Maintenance Creates Opportunity

As families get back on the road and into daily school routines, service drives have an opportunity to capture customers who are behind on recommended vehicle maintenance.

Read More →
Ad Loading...
Mitsubishi shadow line-up
Industryby Hannah MitchellAugust 25, 2026

Mitsubishi Unveils U.S. Plan

The automaker announced a strategy that includes an expanded lineup and dealership presence, along with more ‘rugged’ and electric models.

Read More →
Photo of a laptop, cellphone and eyeglasses on a desk next to an office window
IndustryAugust 24, 2026

Selling to Grow

The question of whether you should sell your agency and if so, when, is up to you. But it’s a question worth asking to ensure you keep the business on the right path for yourself, employees and clients.

Read More →
Mechanic holding a vehicle diagnostic device while standing above an open car hood
Industryby Hannah MitchellAugust 24, 2026

Recalled Vehicles Hit 5-Year High

Though the number of events has fallen so far this year, impacted units are up significantly. Meanwhile, regulators consider consumer notification changes.

Read More →
Ad Loading...
outside of car dealership with cars parked in front
Industryby Lauren LawrenceAugust 20, 2026

Auto Group Acquires Top-Performing Rooftop

Car Pros sold its Kia Huntington Beach location to Sutherlin Automotive Group, marking the buyer’s third location in Southern California.

Read More →
Cars from the rear on a Shanghai freeway
Industryby Hannah MitchellAugust 19, 2026

China as Pacesetter

Automotive leaders huddled on where North America stands in the global picture and how it can strengthen its position against the Asian juggernaut’s surging industry.

Read More →
Orange BMW car on empty road.
Industryby Hannah MitchellAugust 14, 2026

BMW Concept Car Makes Fuel to Burn

The prototype developed in concert with a South Carolina university engineering team generates more solar energy than it uses in a typical daily commute.

Read More →
Ad Loading...
Six men standing for photo outside of car dealership
Industryby Lauren LawrenceAugust 13, 2026

South Carolina Auto Group Downsizes

Florida-based group Holler-Classic has acquired four rooftops, its first in South Carolina, from Dick Smith Automotive Group.

Read More →
Ad Loading...