Story perspectives

Dealership Profits Soar as Parts, Service Replace Cars

8/20/2026

Summary

Story summary

Dealerships maintain profitability by shifting to parts, service, and finance-insurance revenue as new-car margins soften.
Pretax profit per dealership rose from $1.9 million in 2018 to $6.8 million in 2022.
Gross profit for publicly traded dealership groups fell to about $3.9 million in 2025.
Parts and service gross profit grew from $3 million in 2020 to $5 million in 2025.
Analyst Glenn Chin said finance-insurance products yield near-pure profit because dealers act as contract conduits.

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Story summary

Dealerships maintain profitability by shifting to parts, service, and finance-insurance revenue as new-car margins soften.
Pretax profit per dealership rose from $1.9 million in 2018 to $6.8 million in 2022.
Gross profit for publicly traded dealership groups fell to about $3.9 million in 2025.
Parts and service gross profit grew from $3 million in 2020 to $5 million in 2025.
Analyst Glenn Chin said finance-insurance products yield near-pure profit because dealers act as contract conduits.