“Q3 brings slowing profit growth and margin declines amid market shift on EVs and tough comp vs. Q3 2024”
Vehicle sales volume and per-vehicle margins for the average U.S. franchised dealership dropped, while overall profit growth, strong in the second quarter of 2025, notably slowed in the just-completed third quarter, shaped in part by one-time factors.
Volumes and vehicle margins dipped in the third quarter of 2025 for the average U.S. dealership compared with both the year-earlier quarter and this year’s strong second quarter that was boosted by new-vehicle buyers rushing to get ahead of tariff-related price increases.
Meanwhile, pretax profit for the average dealership in the third quarter rose from year-earlier levels as dealership profitability continued its rebound in 2025. At 7.0%, the rate of profit gain, however, narrowed significantly from this year’s second-quarter increase of 27.1%.