“With average dealership performance leveling, has the industry reached a new normal?”
The Presidio Year-End 2024 Dealer Direction Survey highlights stabilization as the story heading into 2025. Many dealers view the worst of the drop-off from pandemic profit highs as being behind them. Their outlook about the future of auto retailing is broadly more optimistic following the conclusion of the 2024 election. And they expect parts and service to be the biggest driver of profitability for their businesses in 2025.
About 65% of dealers expect profitability to stay the same or improve in 2025. By contrast, just 37% of survey takers in Presidio’s midyear 2024 survey had the same expectation for the following 12 months. Respondents’ three-year outlook on profitability in the year-end survey was more optimistic than both their current 12-month view and their three-year view from the prior survey.
A similar pivot occurred around dealership valuations. Nearly two-thirds of dealers now expect values to stay the same or improve over the next year, up from less than half in last summer’s survey. Views on valuation over the next three years similarly improved.