Buckle up, because the numbers from 2023 reveal an auto retail industry in full, powerful motion, with sales roaring back, electric vehicles accelerating into the mainstream, and a shifting consumer profile steering the market in surprising new directions.
Key Takeaways
- In 2023, U.S. new vehicle retail sales totaled 15.5 million units, marking a 13% increase from 2022, driven by improved supply chains.
- Auto dealerships in the U.S. generated $1.2 trillion in total revenue in 2023, with new vehicle sales contributing 62% of that figure.
- Average new vehicle transaction price in the U.S. rose to $48,759 in Q4 2023, up 3.5% year-over-year due to premium model demand.
- New vehicle inventory at U.S. dealerships averaged 2.7 million units by end of 2023, up 50% from 2022 lows.
- Average days' supply for new vehicles in U.S. retail fell to 65 days in Q4 2023 from 75 days in Q3.
- Used vehicle inventory at dealerships stood at 2.4 million units in December 2023, a 20% increase YoY.
- 35% of U.S. car buyers in 2023 were millennials (aged 27-42), up from 28% in 2022.
- Female buyers accounted for 52% of U.S. new vehicle purchases in 2023, highest on record.
- Average age of U.S. new car buyer was 53 in 2023, with Gen X dominating at 38% share.
- U.S. EV retail sales reached 1.18 million units in 2023, with Tesla Model Y leading at 385,000.
- Plug-in hybrid sales grew 35% to 210,000 units in U.S. 2023 retail market.
- EV market share of U.S. new vehicle sales hit 7.6% in 2023, up from 5.8% in 2022.
- U.S. auto dealerships employed 1.2 million people in 2023, supporting 4.5 million indirect jobs.
- Average dealership employee count was 285 in 2023, up 5% from 2022.
- Technician shortage affected 76% of U.S. dealerships in 2023 survey.
The auto retail industry grew in 2023 with strong sales, rising prices, and increased electric vehicle demand.
Consumer Demographics and Behavior
- 35% of U.S. car buyers in 2023 were millennials (aged 27-42), up from 28% in 2022.
- Female buyers accounted for 52% of U.S. new vehicle purchases in 2023, highest on record.
- Average age of U.S. new car buyer was 53 in 2023, with Gen X dominating at 38% share.
- 68% of buyers researched vehicles online before visiting dealerships in 2023 survey.
- Hispanic buyers grew to 22% of U.S. auto retail market in 2023, driving compact SUV sales.
- 41% of U.S. consumers traded in vehicles older than 7 years in 2023 purchases.
- Loyalty rate for brand retention in U.S. auto sales was 52% in 2023, down from 55% pre-pandemic.
- 27% of buyers cited fuel efficiency as top priority in 2023 Cox Automotive survey.
- Urban buyers preferred sedans at 18% rate vs 12% for rural in 2023 data.
- Average time spent at dealership dropped to 3.2 hours in 2023 from 4.1 hours in 2022.
- Gen Z (18-26) represented 15% of new vehicle buyers in 2023 U.S.
- 55% of buyers used mobile apps for price comparisons in 2023.
- Income over $100k buyers grew to 48% share of luxury sales in 2023.
- 73% of repeat buyers chose same dealership in 2023 loyalty study.
- Electric vehicle interest peaked at 39% among under-35 buyers in 2023.
- Trade-in values averaged $24,800 for used vehicles in 2023 deals.
- 29% of buyers prioritized safety tech features in 2023 surveys.
- Suburban buyers favored trucks at 28% vs 19% urban in 2023.
- Virtual test drives adopted by 24% of shoppers in 2023.
Consumer Demographics and Behavior Interpretation
While the dealership experience is becoming more efficient for a digitally-savvy, increasingly diverse, and younger buyer base who have clearly done their homework, the industry must now work harder than ever to earn the loyalty of this maturing, pragmatic, and price-conscious crowd who know exactly what they want—and what their old car is worth—before they even walk in the door.
Electric and Alternative Vehicles
- U.S. EV retail sales reached 1.18 million units in 2023, with Tesla Model Y leading at 385,000.
- Plug-in hybrid sales grew 35% to 210,000 units in U.S. 2023 retail market.
- EV market share of U.S. new vehicle sales hit 7.6% in 2023, up from 5.8% in 2022.
- Battery electric vehicles outsold PHEVs 5:1 in U.S. retail in 2023.
- Ford's EV retail sales increased 84% to 116,000 units in U.S. 2023.
- Average EV transaction price fell 10% to $54,300 in Q4 2023 U.S. retail.
- 18% of U.S. luxury vehicle sales were EVs or hybrids in 2023.
- California accounted for 42% of U.S. EV retail sales in 2023 at 499,000 units.
- Hydrogen fuel cell vehicle retail sales remained under 2,000 units in U.S. 2023.
- GM EV sales totaled 75,000 units in U.S. retail 2023.
- Hyundai EV retail share doubled to 4.5% in U.S. 2023.
- EV inventory days' supply was 110 days vs 60 for gas in 2023.
- Rivian delivered 50,000 R1 vehicles in U.S. retail-equivalent 2023.
- PHEV sales led by Toyota RAV4 Prime at 42,000 units 2023 U.S.
- EV incentives influenced 67% of purchases in 2023 surveys.
- Public fast charger network grew 40% to 168,000 ports in 2023 U.S.
- Legacy automakers' EVs captured 45% U.S. market share in 2023.
- EV range anxiety dropped to 22% concern level in 2023 buyers.
Electric and Alternative Vehicles Interpretation
The electric vehicle revolution is charging ahead, albeit with an awkwardly large inventory cushion, as Tesla's Model Y leads the pack, Ford and Hyundai surge forward, lower prices and better chargers soothe range anxiety, but California remains the main character while hydrogen fuel cells are still waiting for their invitation to the party.
Employment and Operational Metrics
- U.S. auto dealerships employed 1.2 million people in 2023, supporting 4.5 million indirect jobs.
- Average dealership employee count was 285 in 2023, up 5% from 2022.
- Technician shortage affected 76% of U.S. dealerships in 2023 survey.
- Service department revenue per dealership averaged $18 million in 2023.
- 92% of dealerships offered remote work options to sales staff in 2023.
- Parts and service gross margins hit 52% average for U.S. retailers in 2023.
- Digital retailing adoption reached 65% of U.S. dealerships in 2023.
- Average dealership F&I profit per vehicle was $2,150 in 2023.
- Dealership service bays averaged 22 per location in U.S. 2023.
- F&I manager turnover rate was 28% across U.S. dealerships 2023.
- Online service appointments booked 35% of total slots in 2023.
- Average salesperson commission per vehicle was $1,450 in 2023.
- 81% of dealerships invested in EV technician training in 2023.
- Parts department staffing increased 10% to meet 2023 demand.
- Customer satisfaction scores averaged 862/1000 for service in 2023.
- Dealership operating expenses rose 6% to $1.8 million per store 2023.
- Collision repair revenue per dealership hit $4.2 million average 2023.
Employment and Operational Metrics Interpretation
Despite a chronic shortage of mechanics and soaring operating costs, the ever-adaptable American dealership keeps its engine humming—or should we say, profiting handsomely—by expertly shifting gears to meet digital demand, train for the future, and wring impressive margins from everything but the actual car sale.
Inventory and Supply Chain
- New vehicle inventory at U.S. dealerships averaged 2.7 million units by end of 2023, up 50% from 2022 lows.
- Average days' supply for new vehicles in U.S. retail fell to 65 days in Q4 2023 from 75 days in Q3.
- Used vehicle inventory at dealerships stood at 2.4 million units in December 2023, a 20% increase YoY.
- Semiconductor shortages reduced U.S. auto production by 1.2 million units in 2023, impacting retail supply.
- 45% of U.S. dealerships reported inventory levels at or above pre-pandemic averages by late 2023.
- Import vehicle inventory share rose to 28% of U.S. new car stock in 2023 due to domestic production lags.
- Average wholesale used vehicle auction price dropped 7% to $23,400 in Q4 2023 amid rising supply.
- U.S. auto retailers turned inventory 8.2 times on average in 2023, fastest pace since 2019.
- Logistics costs for vehicle transport increased 12% YoY in 2023, straining retail margins.
- 62% of new vehicle inventory in 2023 was 2023 model year stock at U.S. dealerships.
- New vehicle days' supply averaged 68 days across U.S. in 2023.
- Used retail inventory turned over every 42 days on average in 2023.
- 2024 model year vehicles comprised 55% of inventory by Dec 2023 U.S.
- Rail transport disruptions delayed 15% of vehicle deliveries in 2023.
- Average lot space utilization at dealerships was 78% in 2023.
- Certified pre-owned inventory grew 18% to 1.8 million units in 2023.
- Auction volume for used vehicles hit 8.5 million units in U.S. 2023.
- Supplier lead times for parts shortened to 45 days average in Q4 2023.
- Off-lease vehicles returned 2.7 million units to market in 2023.
- EV charging station availability influenced 32% of inventory placement decisions in 2023.
Inventory and Supply Chain Interpretation
The auto retail industry, having survived a chip famine that stole a million cars, is now cautiously sipping from a hose of supply, which is delightfully refilling lots but depressingly squeezing margins from both rising transport costs and softening used-car prices.
Sales and Revenue
- In 2023, U.S. new vehicle retail sales totaled 15.5 million units, marking a 13% increase from 2022, driven by improved supply chains.
- Auto dealerships in the U.S. generated $1.2 trillion in total revenue in 2023, with new vehicle sales contributing 62% of that figure.
- Average new vehicle transaction price in the U.S. rose to $48,759 in Q4 2023, up 3.5% year-over-year due to premium model demand.
- U.S. used vehicle retail sales hit 20.1 million units in 2023, accounting for 56% of total light vehicle retail transactions.
- Luxury vehicle segment sales grew 8.2% in 2023 to 3.1 million units in the U.S., led by brands like BMW and Mercedes.
- Pickup truck sales in the U.S. reached 2.9 million units in 2023, representing 19% of total new vehicle sales.
- SUV and crossover sales dominated U.S. market with 11.2 million units sold in 2023, or 72% of new vehicle sales.
- Electric vehicle retail sales in the U.S. surged 49% to 1.2 million units in 2023, per Cox Automotive data.
- Franchise dealership gross profit per new vehicle retailed averaged $2,850 in 2023, up 15% from prior year.
- U.S. auto retail financing penetration reached 85% for new vehicles in 2023, with average loan amount at $39,500.
- U.S. new light vehicle sales were 15.6 million units in 2023, up 12.4% YoY.
- Total U.S. auto retail sales value exceeded $1.1 trillion in 2023.
- Compact SUV sales grew 15% to 2.8 million units in U.S. 2023.
- Used car average price was $27,300 in U.S. retail Q4 2023.
- Full-size pickup sales led by Ford F-Series at 750,000 units in 2023 U.S.
- Midsize SUV sales totaled 1.9 million units, 12% YoY growth in 2023.
- Hybrid vehicle sales rose 42% to 1.1 million units in U.S. 2023 retail.
- Import brand sales share was 49% of U.S. new vehicles in 2023.
- Gross profit per used vehicle retailed averaged $2,420 in 2023 U.S.
- Lease penetration in new vehicle sales was 22% in U.S. 2023.
Sales and Revenue Interpretation
The American auto industry's roaring comeback, fueled by supply chain relief, saw consumers willingly plunging deeper into debt to pay record prices for a fleet increasingly dominated by premium SUVs and trucks, while the electric revolution quietly gained serious traction in the fast lane.
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