BMW brand offers a cautionary tale to automakers who seek to add franchises amid softening sales.
In 2016, BMW added only two franchises, bringing its total to 341. But BMW's U.S. sales dropped 9.5 percent. The double whammy of more franchises and fewer sales dragged average throughput -- sales per franchise, a key indicator of dealership health and profitability -- down 9.6 percent to 922 vehicles sold per franchise.
Asked to comment, Greg Marks, head of center development at BMW of North America, wrote in an email: "The size and locations of the dealer network is strategic, determined by customer convenience and sales potential. Our dealerships have among the highest throughput of new and pre-owned vehicles in our segment.
"The network of BMW Centers is mature, successful and working well."
An analysis of Automotive News' annual exclusive dealership census, compiled by the Automotive News Data Center, shows that average industry throughput slipped 1.3 percent last year, as a small increase in U.S. franchise count outpaced an even smaller increase in light-vehicle sales. But a brand-by-brand tally showed that throughput gains and losses were almost evenly split.
Total U.S. light-vehicle sales edged up 0.3 percent in 2016. The total franchise count rose 1.8 percent to 32,305. That pushed throughput down to 544 vehicles from 551 in 2015.