NADA Reports Increased Dealer Profits;

NADA has reported increased dealer profits at Lexington Mercedes-Benz Dealers and other dealers for the first five months of 2010 compared to 2009. The average net profit has increased to $278,814 since the past year which is a huge sign that the American auto market is now improving. VW Deals offer some of the top incentives for buying Volkswagen models and have resulted in increased sales at Volkswagen dealers. Volkswagen and other models can be serviced at a local Bradenton Body Shop.

Vehicles have been selling better over the past 5-6 months of 2010 due to better consumer confidence than in 2009 when the market was at an all time low. The average net pretax profit margin was 2.3 percent which was also up from 1.3 percent in May of 2009. Net profits over 2 percent are very rare in the industry.

NADA said that the increased sales were due to increased sales in the new and used vehicle departments of dealers, higher profit margins for both new and used vehicles, reduced inventories around the nation, and low interest rates for vehicle financing.

The retail automobile market is gradually coming out of its decline which was at a peak in 2009. Paul Taylor, NADA's chief economist said that, “All key financial numbers are up year to date. The retail automotive market is getting better slowly but surely this year.”

Inventory financing had a big savings increase with floorplan interest cost dropping 117 percent for 2010. During the month of May the average dealership had a balance of $23 per vehicle in its floorplan account. The financial assistance that dealerships have received have offset dealer interest expense per vehicle.

There are over 18,000 new car dealers in the United States and there were about 1,550 more in 2009 by the same time. The number of new dealers will continue to drop for the rest of 2010 by an estimated 500 as the amount of new dealers begin to adjust for the changed economy.