Seven in ten dealerships likely to expand payroll, inventory
GARDEN CITY, N.Y.--(BUSINESS WIRE)--
Two-thirds (66.4 percent) of auto dealership business owners believe the
U.S. economy has already "bottomed out" and is getting better, according
to the second annual survey of auto dealers by Chase Auto Finance.
Nearly 8 in 10 dealers (79.4 percent) believe the auto industry as a
whole is getting better.
The survey, performed in December 2013 among dealership clients that do
business with Chase, found that dealers were most optimistic about
their own business's economy. Eighty-four percent of dealers
say their business is past the worst of the economic downturn and is
getting better - a 6.8 percent increase from the same survey performed
in 2012. Up 8 points from last year's survey, nine in ten (90.5 percent)
say they are anticipating more than 5 percent in overall sales growth
for their dealer.
Dealers planning to expand their business
Preparing their businesses to handle this growth, dealers are eyeing
expansion plans. Key findings from the survey:
71 percent are likely to expand their payroll in 2014 - nearly
10 percent higher than last year. Of those, nearly 30 percent plan to
hire more than 6 people
73 percent are likely to expand their inventory in the next six
months - up from only 60 percent from a year ago
One in four will seek financing for their expansion. Forty-one
percent of those dealers say they would use the financing to increase
their floorplan - an 8 point increase from last year.
"We've seen dealer expectations on hiring and business expansion gain
steadily year over year," said Thasunda Duckett, CEO of Chase Auto
Finance. "Our latest survey results support that, and show optimism for
an economic recovery in the works."
Dealers anticipate pre-owned vehicles, SUV's, will be growth leaders
In thinking through the segments that will drive growth, dealers share
Dealers believe that pre-owned sales will be the most likely
category to drive growth in 2014 (41.3 percent), surpassing new sales
(29 percent), which dropped six points from last year.
Votes for the sedan as the number one selling vehicle dropped nearly
24 points this year, with only 33 percent predicting the sedan would
sell the most.
The SUV surged in popularity among dealers, with 28 percent predicting
this vehicle would sell the most - a 19 percent increase from last
Overall, dealers believe that sedans (43.1 percent), SUV's (41.2
percent), trucks (31.7 percent), and crossovers (28.2 percent) would
"fuel growth" for their business.
Fleet sales drop
Only 26 percent of dealers say they participate in fleet sales - a 17.5
point decline from last year's survey. Of those who do, nearly half
(48.5 percent) say that they are expecting growth in this segment by
less than 5 percent.
About Chase Auto Finance Dealers Survey
The Chase Auto Finance Dealer Survey is an online poll conducted
between December 18, 2013 and January 13, 2014, with 262 responses from
dealers (Dealer Principals) across the country - with a margin of error
+/- 6%. Auto Dealers were drawn from Chase Auto Finance's national
customer base. The survey was administered internally and data was
collected in aggregate.
About Chase Auto Finance
Chase Auto Finance, a division of JPMorgan Chase Bank, N.A. (JPMC), is
one of the leading bank providers of auto financing in the country. With
a portfolio of more than $55 billion in assets and relationships with
more than 75 percent of all U.S. franchised automotive dealers, Chase
Auto Finance provides a broad spectrum of products to meet the full
range of credit needs of their customers. Chase Auto Finance purchases
auto loans and leases from a national network of automotive dealers as
well as making auto loans directly to consumers through various Chase
channels. In addition, Chase Auto Finance provides commercial loans to
auto dealers throughout the U.S. and maintains a reputation for
delivering high-quality services as well as a long-term commitment to
auto dealers and the overall auto industry. More information can be
found at www.chaseautofinance.com.
Source: JPMorgan Chase & Co.