After navigating several tumultuous years marked by pandemic-related disruptions and supply chain challenges, the auto retail sector in New Jersey has made a significant comeback. The New Jersey Coalition of Automotive Retailers (NJ CAR) recently released an illuminating report detailing how the state's automotive retailers bounced back in 2023, achieving remarkable sales growth and substantial economic contributions.
According to the report, titled "The Economic Impact of Franchised New Vehicle Retailers on the New Jersey Economy," neighborhood new car and truck dealerships in New Jersey posted an impressive sales volume increase of nearly 10% in 2023. This surge brought total sales of new and used vehicles, parts, and service to an almost staggering $43 billion.
Reviving from the Pandemic: A Sector on the Rebound
The auto industry faced unparalleled challenges during the COVID-19 pandemic. Factory shutdowns, supply chain bottlenecks, and fluctuating consumer demand created a turbulent environment for car dealerships. However, 2023 marked a year of recovery and growth for New Jersey's auto retail sector.
Jim Appleton, President of NJ CAR, reflected on this resurgence, stating, "It's been four years, but New Jersey consumers and the neighborhood new car and truck dealerships that serve them continue recovering from the unprecedented pandemic-related disruptions." He emphasized the vital role these dealerships play in the state's economy, describing them as "the economic engine that drives the New Jersey economy" by maintaining consumer choice and ensuring vehicle affordability.
Economic Contributions: Jobs, Sales, and Taxes
The NJ CAR report sheds light on the extensive economic impact of New Jersey's franchised automotive retailers. Here are some key findings:
Job Creation and Support: Franchised new car and truck dealerships directly provided or supported more than 72,750 jobs across New Jersey in 2023. This marks a significant recovery in employment levels, bringing them back to pre-pandemic norms.
Sales Growth: The total sales generated by these dealerships reached nearly $43 billion in 2023. This growth underscores the sector's resilience and its ability to thrive despite ongoing economic challenges, such as inflation and rising interest rates.
Average Dealership Performance: Each dealership in New Jersey averaged sales of $85.7 million in 2023, highlighting their robust market presence and operational efficiency.
Employee Compensation: Dealership employees earned a collective $5 billion in compensation last year, with an average dealership payroll of $7.3 million. These figures underscore the dealerships' role as providers of good-paying, stable jobs that come with benefits.
Tax Contributions: Dealerships played a crucial role in the state's fiscal health, collecting or paying more than $2.1 billion in state and local taxes in 2023. These funds are vital for public services and infrastructure development.
Charitable Giving: Beyond their economic contributions, New Jersey's franchised automotive dealerships also demonstrated a strong commitment to social responsibility. Collectively, they contributed more than $26 million to hundreds of charitable causes throughout the year.
NJ CAR: A Century of Service
Founded in 1918, the New Jersey Coalition of Automotive Retailers (NJ CAR) has long served as a backbone for the state's car and truck retailers. As a non-profit organization, NJ CAR represents approximately 500 franchised dealers across New Jersey. Its mission is to promote commercial honor and integrity in the sale and service of motor vehicles.
NJ CAR keeps its members informed on business practices, industry trends, and legislation that affects the automotive retail sector. The organization also ensures that members are well-educated on regulatory compliance, helping to foster a trustworthy and efficient automotive market in New Jersey.
Looking Forward
As New Jersey's automotive retail sector continues to grow and adapt, the insights from NJ CAR's report highlight a positive trajectory. Despite the economic headwinds posed by inflation and higher interest rates, the resilience and adaptability of neighborhood car dealerships have positioned them as critical players in the state's economy.
Jim Appleton and NJ CAR remain optimistic about the future. As they continue to navigate the post-pandemic landscape, these dealerships will likely keep driving economic growth, supporting jobs, and contributing to the community in significant ways.
New Jersey's auto retail sector stands as a testament to the strength and endurance of local businesses, and their continued success will be crucial for the state's economic vitality in the years to come.
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