We have heard the arguments regarding the slowness and shallowness of our recovery from the Great Recession. We understand that NOT all segments of society and NOT all income brackets have shared equally (if at all) in the economy’s rebound. Having humbly accepted that, we offer what is the BEST possible concrete sign of the US’s re”car”very. It is the amazing increase in NEW CAR DEALER (NCD) revenue since 2007 (when the Great Recession started) AND the corresponding growth in the revenue from holiday (Nov & Dec) NCDs. (For more info on Xmas Cars, Holiday Hardtops, etc, please see Scope Issue 24, #124).
Table 1 tells the story of THE Great Recession and THE “Great Recovery” in terms of TOTAL RETAILERs’ revenues, MTR VEHICLES & PARTS DEALERS’ revenues (MV & PD is the most general category that includes NEW CAR DEALERS) and the aforementioned NEW CAR DEALERS’ in revenues. (As noted in T-1 at the bottom, it and ALL subsequent tables in this Scope exclude 722: Food Service & Drnk Estabs from TOT Retailer data). We compared 2006 (The last yr b-4 the Grt Recession began in Dec of 2007) with 2009 (The last yr of the Grt Recession which included ONLY the 1st 6 mos of 2009) and last yr, 2013 (The most robust yr past the Grt Recession, with yet even greater expectations for 2014).
- In 2006, the % of MTR VEH & PRTS DLRS (MV & PD) revenue (the general car category) was 22%. So strong is the general category that even its subcategory NEW CAR DEALERS (shaded row) was 17% of TOT/ALL RETAILERS’ revenue. WOW! And, as such whether it’s MD & VP or its subcategory NCD, both were greater than the #2 and #3 general retailer revenue categories of GEN’L MDSERS at 7% and FOOD & BEV STORES at 12.9%. WOW!
- In 2009 as the Grt Recession eviscerated American retailers AND consumers alike, we find MV & PDs expectedly being a much lower% of TOT RETAILERS’ revs (ONLY 6%) while GEN’L MDSERS and FD & BEV STORES had grown to 16.3% and to 15.7%, respectively. (The logic here is inescapable.) As a result, of course, NEW CAR DEALERS’ % of the TOTAL RETAILERS’ revenues shrunk to 13.4% with. Now, it actually was smaller than either GEN’L MDSERS or FD & BEV RETAILERS’ revenues. WOW! WOW!!
- In 2013 we see ample evidence of our RE”CAR”VERED economy as MV & PDs again robusted to the tune of being 6% of TOTAL RETAILER revenue with GENL MDSERS & FD & BEV STORES’ %’s shrinking to 14.4% and 14.3%, respectively. The result was that 2013 NEW CAR DEALERS’ revenues were once more greater than either of the aforementioned %s with a 16.4% of TOTAL RETAILERS’ revenues. Hence, the recovery is well documented by the strength of NEW CAR DEALER DOLLAR$! (DÉJÀ VU, all over again!
Tables 2 and 3 demonstrate the parsimony b/t the “UPS & DOWNS” of ALL (TOT) RETAILERS’ revenue and the “UPS & DOWNS “ of NEW CAR DEALERS’ revenues from 2006-2013. Our points being that NEW AUTO DEALERS revenues well reflect the economy’s slowdown in 2007 with a growth of ONLY .3% yr over yr (T-2) and the devastating start of the Great Recession during the holiday season of 2007. Dec is given the distasteful & dubious distinction of being the 1st mo of the Great Recession. NCD revenues in N & D of 2007 was -2.4% followed by the catastrophic -30% (T-3) for N & D of 2008 (the ONLY full yr for the Great Recession.) OUCH! (Tables 2 & 3 give a fair and detailed view of the Grt Recession from a RETAILERS’ perspective whether it be revenues from ALL/TOT RETAILERS or NEW CAR DEALERS revenues. For greater insight pls see Appendix-A)
- Please notice that the growth of Nov & Dec’s NCD revenues’ for each year (from 2007 to 2013 whether increases or decreases) was generally much greater than were the TOT RETAILERS’ increases or decreases. For example in the only full yr of the Great Recession (2008) the yearly decrease was 3% vs a decrease of 29.9% for NCD. WOW! By the same token in 2013, when TOTAL RETAILERS’ revenues increased by 3.5% so did NCD with a very handsome increase of 9.0%. More specifically, for the last yr of Grt Recession (2009), the revenue growth for both TOT RETAILERS & NCD were negative (-7.3% & -15.3%,respectively)while holiday season revenues (Nov & Dec) were positive (2.9% & 8%). There is NO question that the holiday season made a strong impact on both TOTAL RETAILER revenues & NCD revenues.
- The same pattern was even more sharply displayed when comparing TOTAL RETAILERS’ revenues with NEW CAR DEALERS’ revenues for the holiday season (Nov & Dec). For example:
- 2009 saw a revenue growth of 9% for TOTAL RETAILERS vs an almost 8.0% increase for NCDs; and
- 2013 saw a growth of 5% for TOTAL RETAILERS’ revenues vs 9% for NCD’s revenues.
RE”CAR”VERY IS HERE! IT I$ IN THE GARAGE!! HAPPY HOLIDAYS!!!
Table 6 is merely the summative result of T-4 & T-5. In large part T-6 affirms and confirms the importance of NCDs data on both a yearly basis and on a holiday season basis as well. Having said that, T-6 takes us through the Grt Recession and its recovery on a yr by yr basis & on a holiday season by holiday season basis. From 2005 to 2007 NCD revenues lost 1.3% of TOTAL (ALL yrs) RETAILER revenues (meaning other retailers got it.) As for NOV & DEC revenues, NCD’s lost 1.1%. From 2007 to 2008 there was a precipitous drop in the full yr of NCD revenues (-2.6%) while holiday NCD revenues lost 2%. From 2009 to 2010, yearly NCD revenues increased by 1% as the GRT Recession ended in June of 2010. We see the impact of the early recovery however, for NCD in its holiday revenues for 2009. It actually increased by a full 1.3% over 2008. Finally, we continue to see the growth in NCD revenues from 2010 to 2013 with a full year growth in revenue of 2%. From ’10 to ’13, holiday season (N&D) increased by 1.9%. With some explained exceptions holiday over holiday increases & decreases have become almost the mirror image of yearly NCD revenues. In other words in recent yrs what happens during the holiday season both reflects backward to yearly revenues (b/c of its great size) AND sets the table for the following year. (Again, pls see Scope vol 24, Issue 124 for further details about the holiday cars).