10 • November 2023 • Powersports Business
FINANCE www . PowersportsBusiness . com
PRE-OWNED MARKET
CONTINUED FROM PAGE 9
recreational industries , with RV and marine markets being the two best benchmarks .
Woodruff explains : “ Powersports is up 14.6 percent from 2019 , which I use as a pre- Covid benchmark . Even though it is down slightly from last year … essentially , this year looks a lot like last year .”
Woodruff adds that consumers continue to spend money , and their confidence has improved . “ On the flip side , though , there are some warning signs . Inflation is still too high . It ’ s almost double the Fed ’ s two percent target and is on the rise again . Interest rates are definitely high , and they ’ re not stopping anytime soon . Personal savings have come down . All of the money [ consumers ] received during Covid has been spent . They are back to equal to or slightly below what they had in their bank accounts before Covid .”
RETURNING TO NORMAL From a seasonality perspective , NPA says we ’ re starting to see a return to normal seasonality . And this is a good sign for normalcy within the market , according to Woodruff . “ The amount of inventory on the books has grown from last year . Dealers have inventory , and equally important is that sales volumes have remained strong . The inventory is turning . Last year , about the August time frame , inventory was turning at a rate of about seven times a year , and it ’ s now down to a little under four , so it ’ s getting closer to normal . These are all fairly normal numbers .” He adds that these are good signs that things are returning to normal .
In the current economy , as the Fed tries to control inflation , there ’ s typically a slowdown in retail demand . However , consumers are still buying vehicles . “ Interest rates , qualifying standards , and negative equity is a challenge now ,” Woodruff states . “ But
See Pre-Owned Market , Page 12 there ’ s an increase PERCENT in new OF inventory TOTAL PRE-OWNED levels , and UNIT as interest SALES rates BY REGION have increased , it ’ s
35 % 32 %
30 %
27 %
25 %
20 % 18 %
15 % 13 %
10 % 6 %
5 % 4 %
0 % South Midwest West Northeast California Northwest
Source : CDK Lightspeed
DEALER FINANCIAL SNAPSHOT
NORTHWEST -4.1 % Parts Department 0.7 % Service Department -8.8 % Major Units -7.1 % Overall
WEST -6.4 % Parts Department -1.1 % Service Department -7.1 % Major Units -6.3 % Overall
UNITED STATES -5.3 % Parts Department 1.5 % Service Department -4.5 % Major Units -3.9 % Overall
MIDWEST -7.3 % Parts Department 2.1 % Service Department -3.6 % Major Units -3.2 % Overall
SOUTH -3.1 % Parts Department 3.4 % Service Department 0.1 % Major Units 0.2 % Overall
NORTHEAST -5.4 % Parts Department 1.0 % Service Department -11.1 % Major Units -9.2 % Overall
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SEPTEMBER 2023 VS . SEPTEMBER 2022
Dealerships reported an average combined revenue decrease of 3.9 % in September , according to composite data from more than 1,700 dealers in the U . S . that use the Lightspeed DMS . The average dealer was down 5.3 % in the parts department . The Midwest saw the largest decrease in parts revenue , reporting a dip of 7.3 %. The West followed , reporting a 6.4 % decrease . Every region but the West was up in service revenue in September . The South reported
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the largest increase of 3.4 %. The average dealership was down 4.5 % in sales . The Northeast , Northwest , and West reported the largest revenue losses , hovering around a 10 % loss . The South ( 0.1 % increase ) was the only region to report a revenue increase in the sales department . The South was also the only region to report a combined revenue growth in September 2023 versus the year ago month . The Northeast reported the largest decrease in combined revenue of 9.2 %, followed by the Northwest , reporting a decrease of 7.1 %. |
PARTS SALES Parts sales revenue was up at 728 dealerships and down at 1027 .
SERVICE SALES Service revenue increased at 901 dealerships and decreased at 803 .
MAJOR UNIT SALES A total of 708 dealerships were up and 863 were down .
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FOR MORE ON THE SAME STORE SALES DATA
For more information on this report and other industry data , contact : lightspeeddms . com
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