Auto Dealers Concerned about Affordability, Profit Margins – RVBusiness – Breaking RV Industry News
Dealers move into 2024 with continued concerns about high interest rates and vehicle affordability, though some are confident service, parts and collision operations will provide a profit lift, according to an Automotive News report.
Dealership executives who participated in Automotive News’ 2024 Dealer Outlook Survey said they remain wary of how interest rates and affordability could further disrupt their businesses. A majority are concerned new-car profit margins will decrease year over year, with some expecting to spend more money to advertise vehicles and service work to consumers who are worried about higher purchase prices and borrowing costs.
Many respondents are not yet ruling out a recession this year, either.
“Even though the demand is there, that doesn’t mean the ability is there,” Ben Keating, president of Keating Auto Group, of Victoria, Texas, told Automotive News. His group has 29 dealerships in Texas and ranks No. 15 on Automotive News‘ list of the top 150 dealership groups based in the U.S., retailing 31,936 new vehicles in 2022.