2013 sales per US franchise fell for Volkswagen and Infiniti

Article by Eugene Conan, on March 15, 2014

The sales per franchise in United States of Volkswagen and Infiniti dropped in 2013, no thanks to the addition of more franchises as well as a stumble in their brand sales in the country. The VW brand saw its sales drop 7 percent in 2013, resulting to 10-percent slide in sales per franchise. Infiniti, meanwhile, logged a 3-percent fall in sales last year, leading to a 5-percent slump in sales per franchise.

Both VW and Infiniti increased their franchise count by 4 percent. Overall new-vehicle sales in the US surged 8 percent in 2013, while the number of new-vehicle franchises gained less than 1 percent.

"When your throughput is higher, your profits are higher, your dealers are happier," Tom Libby, an auto analyst with IHS Automotive, said. "They're spending money on the facility and they're hiring people so your whole retail network is stronger." In 2013, some brands added a few franchises while others let attrition take its course, although changes in the franchise count generally were modest.

The overall number of new-vehicle dealerships and franchises was flat, according to the exclusive annual dealership census gathered by the Automotive News Data Center. As of Jan. 1, 2014, the number of new light-vehicle dealerships in the US rose 0.6 percent from a year ago to 17,875.  The number of franchises, meanwhile, rose just 0.3 percent to 31,464.

While a franchise refers to an agreement giving a dealer the right to sell a certain brand of new vehicles, a dealership is the building wherein the brand or brands are sold. Infiniti could replicate the move made by its Nissan brand sibling in the US. Nissan cut the number of its US franchises by 1 percent to 1,061 in 2013 while sales leaped 11 percent, boosting sales per franchise by 11 percent to 1,064. [source: automotive news - sub. required]

Topics: vw, infiniti, sales

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