Automobile Dealers (United States) — NAICS 4411

A rollup primer for both public- and private-market investors. NAICS (the North American Industry Classification System, the U.S. federal standard for grouping businesses) code 4411 — Automobile Dealers is a four-digit "industry group" that sits inside subsector 441 (Motor Vehicle and Parts Dealers). It contains exactly two child industries: 44111 New Car Dealers and 44112 Used Car Dealers. This page synthesizes the two child primers and our ground-truth federal statistics for the 4411 level; its distinctive value is the contrast between the two children. For the full detail on each, read the child primers.

1. Overview

Automobile Dealers is where the two halves of America's car-retailing economy are counted together: the franchised stores that sell factory-new vehicles, and the independent lots that retail only used ones. Combined, it is one of the largest consumer-facing industries in the country — roughly $1.35 trillion in receipts and 1.29 million paid employees in the federal data [1][2].

But "combined" hides the real story. The two children are structurally opposite businesses that happen to share a product. New-car dealers are few, large, corporately owned, and legally protected; used-only dealers are many, small, cash-heavy, and completely open to competition. New-car stores book roughly seven of every eight sales dollars in the group; used-only lots are the majority of the businesses. One half is a mature, franchise-shielded oligopoly-of-locals consolidating slowly; the other is a volatile, price-sensitive spread business that Wall Street has tried (and sometimes failed) to disrupt. Understanding 4411 as an investor means understanding how those two halves differ — so this primer leads with the contrast, then covers the group as a whole.

2. What's inside — the two children and how they differ

NAICS 4411 subdivides into exactly two five-digit industries. Each of those, in turn, has a single six-digit child, so the five- and six-digit codes below name the same populations:

The dividing line is simple: a dealer that holds a franchise to sell a manufacturer's new vehicles is a new-car dealer (even though it also sells plenty of used cars, service, and parts); a dealer that sells only used vehicles is a used-car dealer. Everything else automotive — parts and tire stores, recreational-vehicle and motorcycle dealers, gas stations, repair shops, and the automakers themselves — sits in other NAICS codes and is not in 4411.

Here is how the two children compare on the dimensions that matter to an investor. Figures are from our federal ground truth for the group and the two child primers [1][2][3][7].

The one-line takeaway. New-car dealing is a scale-and-protection business: a few big, corporate, legally shielded operators earning steady money across four profit centers. Used-car dealing is a velocity-and-spread business: many small operators turning depreciating inventory fast, exposed to every swing in used-vehicle prices and credit. They roll up into one group, but you would never analyze them the same way.

3. Size (rollup figures and the undercount caveat)

These are our ingested ground-truth federal figures for NAICS 4411. Receipts, firm count, and the concentration ratios are from the 2022 Economic Census (EC); establishments, employment, and payroll are from 2023 County Business Patterns (CBP) [1][2].

The group is genuinely just the sum of its two children — and it ties out. Add the child figures and you land almost exactly on the group total: establishments 21,910 + 25,147 = 47,057 (exact); employment 1,131,340 + 162,048 = 1,293,388 (exact); annual payroll $89.7B + $9.05B ≈ $98.8B; receipts ≈$1.19T + $159.5B ≈ $1.35T [2][3]. The only line that does not add cleanly is firms: the children sum to 40,257 but the group reports 40,014, because a handful of companies operate both a new-car and a used-only business and are counted once at the group level but in both children below it. What the arithmetic makes vivid is the asymmetry already flagged in Section 2 — new-car dealers dominate the money and the payroll, used-only dealers dominate the headcount of businesses.

Undercount caveat — read before quoting $1.35 trillion or "the size of the U.S. car market." The federal figure understates the true car-retailing economy for three reasons, and the direction of the error differs by child:

• Nonemployer businesses are excluded. CBP and the Economic Census count only employers (firms with paid staff); our ingested data include no nonemployer estimate. This barely dents the new-car side (franchised stores are payroll-heavy and well captured — the ~17,242 firm count lines up with industry tallies of roughly 16,900 franchised rooftops [4]) but meaningfully understates the used side, which is full of tiny owner-operated lots.
• Private-party used sales are not here at all. Nearly half of all used-vehicle transactions are person-to-person, with no dealer; they appear in no dealer's receipts.
• New-car dealers' large used business is booked under 44111, not 44112. Franchised stores sell millions of used vehicles, but that revenue counts in the new-car code. So the $159.5 billion "used" line is only what used-only dealers ring up — not the size of U.S. used-car retailing, which spans roughly 36 million units a year across both codes and private parties [5].

Net effect: the group receipts number is a reliable measure of dealer-booked sales, but it neither captures the full used-vehicle economy nor cleanly splits new-versus-used activity.

4. Investable universe (where value concentrates across the children)

There is no single "auto dealer" stock, and the two children lead to almost entirely different rosters. Value concentrates in a small number of large operators sitting atop a very long private tail — but which operators, and how you own them, depends on the child.

On the new-car side (44111) the public map is unusually clean — six pure or near-pure franchised retailers, each with 2025 revenues between roughly $15 billion and $38 billion [6]:

• Lithia Motors (ticker LAD), Penske Automotive Group (PAG), AutoNation (AN), Group 1 Automotive (GPI), Asbury Automotive Group (ABG), and Sonic Automotive (SAH).

Behind them sit very large private groups — Hendrick Automotive Group (the largest privately held group), Berkshire Hathaway Automotive (owned by Berkshire Hathaway, BRK.A / BRK.B), and others such as Ken Garff, Morgan Auto Group, and Holman — and then thousands of family-owned single- or few-store operators [7][8]. Even the 150 largest groups sell only about a quarter of new vehicles; the majority of the industry is still independent [7].

On the used-car side (44112) there is no single dominant pure-play, but a richer ecosystem:

• Pure-play used retailers: CarMax (KMX), Carvana (CVNA), and buy-here-pay-here chain America's Car-Mart (CRMT) — the most direct, and most cyclical, exposure. Even CarMax, the biggest, holds only ~3.7% of the late-model used market [9].
• "Picks and shovels": wholesale marketplaces OPENLANE (KAR) and ACV Auctions (ACVA); listing sites Cars Commerce (CARS) and CarGurus (CARG); the salvage-auction pair Copart (CPRT) and RB Global / IAA (RBA); and subprime lender Credit Acceptance (CACC) — businesses that profit from transaction volume regardless of which lot wins the sale.
• Private tier: Cox Automotive's Manheim wholesale auctions (the price-setting engine of the whole used market), large privates such as DriveTime and Enterprise Car Sales, and roughly 23,000 independent lots, many family-owned or private-equity-backed [3].

The overlap worth knowing: the six public new-car groups (LAD, AN, PAG, GPI, SAH, ABG) are also among the largest used retailers in the country — their used sales just count under 44111. So a share in Lithia or AutoNation is exposure to both children at once, while a share in CarMax or Carvana is used-only.

5. How the money works

The two children make money in fundamentally different ways, which is why one group-level description does not fit both.

New-car dealers run four profit centers under one roof, and the showroom is the least profitable of them. New vehicles are most of the sales but only about a quarter of gross profit (thin margins on the metal); used vehicles contribute a similar slice; finance and insurance (F&I — the desk that arranges loans and leases and sells add-ons like service contracts and GAP, or guaranteed asset protection) is a high-margin add-on; and fixed operations (service, parts, and collision) is the real engine — a modest share of sales but roughly half of total gross profit, because repair and maintenance work recurs regardless of the sales cycle [4][10]. Net margins are thin (commonly 1–3% of sales) but sit on tens of millions of revenue per rooftop — hence the ≈$69 million revenue-per-firm figure in Section 2.

Used-only dealers run a spread business layered with finance income. Retail price minus acquisition cost, reconditioning, transport, and selling costs equals vehicle gross profit; the metrics that matter are gross profit per unit (GPU), inventory turn / days-to-sell, reconditioning cost, and F&I penetration. The retail spread on the metal is thin, so the larger profit pools are often F&I and — for buy-here-pay-here (BHPH) lots that lend to subprime buyers — the loan itself. The central hazard is the inventory trap: a used car is a depreciating, price-volatile asset, so when wholesale values fall, a lot loses value faster than it can sell. This is why the used side carries far more per-firm risk on ≈$7 million of revenue than the new side does on ≈$69 million.

Full mechanics, per-unit figures, and company GPU comparisons are in the two child primers (441110 §5 and 441120 §5).

6. Demand drivers

Both children ultimately sell the same product to the same households, so the top-line drivers rhyme — but each side has its own swing factors.

Shared across the group:

• Affordability and financing. Most buyers finance, so the monthly payment governs demand. New-vehicle average transaction prices crossed $50,000 for the first time in late 2025, with new-car loan rates near 6.7–6.8% [11][12].
• Interest rates and the macro cycle. A car is a big-ticket discretionary purchase, so sales track jobs, confidence, credit availability, and rates. Higher rates also raise dealers' floorplan (inventory-financing) costs — a double hit.
• Fleet age and replacement. The average vehicle on U.S. roads hit a record ~12.8 years in 2025, a tailwind for both replacement sales and the service bays [13].
• New-versus-used substitution. The two children are substitutes: record new prices push buyers into used, and vice versa.

Mostly new-car: manufacturer supply and incentives, and product/powertrain mix — including electric vehicles (EVs), which are dominated by direct-selling brands (Tesla, Rivian, Lucid) that largely bypass franchised dealers [14].

Mostly used-car: the lease/trade cycle — today's used inventory comes from new sales two-to-four years earlier, and off-lease maturities are ramping through 2026 — plus wholesale used-vehicle prices, tracked by the Manheim Used Vehicle Value Index (MUVVI), and a seasonal tax-refund "spring bounce" [15].

7. Regulation

Regulation is the single sharpest structural difference between the two children.

New-car dealers are among the most legally protected retailers in America. State franchise (dealer-protection) laws in all 50 states bar most automakers from selling new vehicles directly to consumers and require sale through independent franchised dealers; on top of that sit manufacturer requirements imposed through the franchise agreement itself [16]. This legal moat is the industry's defining feature — and its biggest open question is whether those laws survive the direct-sales and "agency model" push tied to the EV transition.

Used-only dealers have no such moat. They are regulated mainly at the point of sale and largely by the states: the Federal Trade Commission's (FTC) Used Car Rule (the "Buyers Guide" window sticker), federal odometer disclosure via the National Highway Traffic Safety Administration (NHTSA), the FTC Safeguards Rule and fair-lending law (the Equal Credit Opportunity Act, ECOA) for dealers that arrange financing, and state licensing [17][18].

Common to both: the FTC's 2024 CARS Rule (Combating Auto Retail Scams) was vacated by a federal appeals court in early 2025 and formally withdrawn effective February 2026, so it is not in force — but scrutiny of F&I markups and "junk fees" continues (the FTC warned 97 dealership groups about deceptive pricing in March 2026, and several states are writing their own rules) [19][20]. Federal safety (NHTSA) and emissions (Environmental Protection Agency, EPA) oversight applies to the vehicles themselves. Full detail is in the child primers (441110 §7, 441120 §7).

8. Consolidation

By the federal numbers, the whole group is strikingly un-concentrated. The largest four firms held just 8.4% of receipts in 2022, the top eight 12.7%, the top 20 17.6%, and the top 50 21.5%; the HHI (a standard concentration gauge running from near-zero to 10,000 for a monopoly) was a mere 26 [1]. That is about as fragmented as any trillion-dollar industry gets.

But the two children fragment differently, and the contrast is instructive:

Two things jump out. First, the used side is markedly more top-heavy — CarMax, Carvana, and a few large chains give it a CR4 of ~30% versus ~8% for new — yet it is still fragmented, and its HHI is suppressed in the federal data, so no value is stated. Second, the group's CR4 (8.4%) is identical to the new-car CR4, which tells you the four largest firms in the entire group are the big franchised megadealers (Lithia, Penske, AutoNation, Group 1) — the dominant used-only players like CarMax simply disappear against the group's $1.35-trillion base.

Fragmentation is the investment thesis for the scaled operators on both sides: with tens of thousands of independent stores and a steady supply of retiring owners, the public groups and large privates can grow for years by acquiring, through an active "buy-sell" market at "blue sky" earnings multiples [7][21]. A caveat when reading headlines: much of the loudest auto-retail deal flow involves franchised (441110) dealers, so it can overstate the consolidation visible in the narrower used-only code.

9. Risks

The group inherits both children's risk lists, some shared and some specific:

• Cyclicality and interest rates (shared, worse for used). Financed big-ticket purchases fall in downturns; higher rates cut buyer demand and raise floorplan financing costs on unsold inventory — a double bite that hits thin-margin used lots hardest.
• Margin normalization. Both sides are coming off the abnormal 2021–2022 inventory-shortage profit peak; per-unit margins have been drifting back toward historical norms [10].
• The inventory trap (used-specific). A falling MUVVI can wipe out used-lot margins fast — Carvana's 2022 near-collapse is the cautionary tale [15].
• The EV / direct-sales threat (new-specific). Direct-selling and "agency" models challenge the franchise structure that protects new-car dealers.
• Credit losses (used-specific). For BHPH and subprime lenders, a weakening consumer can swing results from profit to loss quickly [9].
• OEM and product dependence (new-specific). Franchised dealers live or die by a manufacturer's product, allocation, and incentives.
• Regulatory and litigation risk (shared). Ongoing scrutiny of F&I markups, add-ons, and advertising, plus state junk-fee rules [19].
• Tariffs and input costs (shared). 2025's 25% auto tariffs were estimated to add roughly $2,000–$6,000+ per affected vehicle, pressuring both new prices and, indirectly, used values [22].
• Technology-vendor concentration (shared). The 2024 CDK Global ransomware attack disrupted roughly 15,000 dealerships, underscoring how few software vendors the whole industry depends on [23].

10. How to invest, and the outlook

Public routes. Choose the child that fits your thesis. For new-car exposure, the six franchised retailers — LAD, PAG, AN, GPI, ABG, SAH — are historically capital-efficient, cash-generative businesses that return a lot of cash through buybacks and typically trade at low earnings multiples reflecting cyclical earnings; judge them on operating quality (units and gross profit per unit, F&I penetration, service absorption, inventory days' supply and floorplan expense, acquisition returns) rather than headline revenue. For used-car exposure, pick your sub-sector: pure-play used retail (KMX, CVNA, CRMT) for the most direct and most cyclical bet, or "picks and shovels" (KAR, ACVA, CARS, CARG, CPRT, RBA, CACC) that profit from transaction volume whoever wins the sale. Remember the diversified new-car groups also carry large used operations, so LAD/AN/PAG span both children. (Share prices, yields, and valuation multiples change constantly and should be checked at the time of any investment.)

Private routes. Because most of the group is private, the most direct exposure is owning the asset: buy or operate a rooftop or group (a new-car franchise requires OEM approval; a used-only lot does not), participate in the active buy-sell or private-equity roll-up market, provide floorplan (inventory) financing, own and lease dealership real estate, or invest in dealer-services software and auction technology [21]. The private tier is where the great majority of the ~40,000-firm group actually lives.

Outlook. A mature but durable industry group. New-vehicle sales are expected to run near a 16-million-unit annual pace (Cox Automotive's 2026 outlook calls for ~15.8 million new units, a slight decline in used retail, and ~2% wholesale used-price growth) [5][24]. The near-term direction hinges on the same levers for both children — interest rates, affordability at record prices, off-lease used supply, and the trajectory of 2025's tariffs — while the durable service, parts, and F&I profit lines (new) and resilient used-vehicle demand (used) keep the group attractive across the cycle. The one genuinely structural question is whether the state franchise laws that protect the larger, richer half of the group survive the EV-era direct-sales push. Both children remain fragmented and consolidating, which is the standing bull case for the scaled operators on either side [1][7][22].

For the complete treatment of each half — full company tables, detailed economics, and complete source lists — read the child primers: NAICS 44111 (New Car Dealers) and NAICS 44112 (Used Car Dealers).

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Sources

1. U.S. Census Bureau, 2022 Economic Census — Summary and Concentration Statistics for NAICS 4411 and children (receipts, firms, CR4/CR8/CR20/CR50, HHI), 2024. https://data.census.gov/table/ECNBASIC2022.EC2244BASIC
2. U.S. Census Bureau, County Business Patterns 2023 — NAICS 4411 and children (establishments, employment, annual and Q1 payroll), 2025. https://www.census.gov/data/datasets/2023/econ/cbp/2023-cbp.html
3. Child primers, NAICS 44111 (New Car Dealers) and NAICS 44112 (Used Car Dealers) — federal figures and rosters synthesized in this rollup, 2026.
4. National Automobile Dealers Association (NADA), NADA Data — Annual Financial Profile of America's Franchised New-Car Dealerships, 2026. https://www.nada.org/nada/nada-data
5. Cox Automotive, 2024 used-vehicle sales (~36 million units) and 2026 outlook, 2024–2025. https://www.coxautoinc.com/insights-hub/certified-pre-owned-sales-rebound-and-outperformed-used-vehicle-market/
6. Public franchised retailers' 2025 results — Lithia Motors (LAD), Penske Automotive Group (PAG), AutoNation (AN), Group 1 Automotive (GPI), Asbury Automotive Group (ABG), Sonic Automotive (SAH), 2026. Company filings and press releases.
7. Automotive News, 2026 Top 150 Dealership Groups, 2026. https://www.autonews.com/retail/top-150-dealership-groups/
8. Hendrick Automotive Group / Berkshire Hathaway Automotive, Corporate overviews (largest privately held auto retailers), 2026. https://www.hendrickcars.com/corporate-history.htm
9. CarMax, Inc. and America's Car-Mart, Inc., Fiscal 2025–2026 results (used units, GPU, ~3.7% late-model share, buy-here-pay-here economics), 2025–2026. https://www.sec.gov/Archives/edgar/data/1170010/000117001026000021/kmx-20260228.htm
10. Haig Partners, Q3 2025 Haig Report — New-Vehicle and F&I Gross Profits, 2025. https://haigpartners.com/resources/q3-2025-haig-report-fi-gross-profits-climb-toward-new-highs/
11. Kelley Blue Book / Cox Automotive, New-Vehicle Average Transaction Price Surges Past $50,000, 2025. https://mediaroom.kbb.com/2025-10-13-Kelley-Blue-Book-Report-New-Vehicle-Average-Transaction-Price-Hits-Record-High-in-September,-Surges-Past-50,000-for-the-First-Time-Ever
12. Experian, State of the Automotive Finance Market — average auto loan rates, 2025. https://www.experian.com/blogs/ask-experian/auto-loan-rates-financing/
13. S&P Global Mobility, Average Age of Vehicles in the US Rises to 12.8 Years in 2025, 2025. https://www.spglobal.com/automotive-insights/en/blogs/2025/05/average-age-of-vehicle-in-us
14. CleanTechnica, Tesla Had 46% of US EV Market in 2025, 2026. https://cleantechnica.com/2026/02/04/tesla-had-46-of-us-ev-market-in-2025-down-from-49-in-2024-gm-13-ford-7/
15. Cox Automotive / Manheim, Used Vehicle Value Index — 2025–2026 trends (index levels, off-lease supply, rates), 2025–2026. https://www.coxautoinc.com/insights/manheim-used-vehicle-value-index-mid-july-2026-trends/
16. Wikipedia, Direct-to-consumer automobile selling in the United States (state franchise / direct-sales law counts), 2025. https://en.wikipedia.org/wiki/Direct-to-consumer_automobile_selling_in_the_United_States
17. Federal Trade Commission, Dealer's Guide to the Used Car Rule (Buyers Guide requirement) and Safeguards Rule FAQ, 2025. https://www.ftc.gov/business-guidance/resources/dealers-guide-used-car-rule
18. National Highway Traffic Safety Administration, Odometer disclosure requirements and Laws & Regulations, 2020–2026. https://www.nhtsa.gov/laws-regulations
19. Federal Trade Commission, FTC Warns 97 Auto Dealership Groups About Deceptive Pricing, 2026. https://www.ftc.gov/news-events/news/press-releases/2026/03/ftc-warns-97-auto-dealership-groups-about-deceptive-pricing
20. Holland & Knight, Fifth Circuit Strikes Down FTC's Auto Retail Scam (CARS) Rule, 2025. https://www.hklaw.com/en/insights/publications/2025/02/fifth-circuit-strikes-down-ftcs-auto-retail-scam-rule
21. Dave Cantin Group / Used Car News, Record dealership buy-sell activity and consolidation, 2025, 2025. https://usedcarnews.com/auto-econ-news/record-breaking-2025-what-the-surging-buy-sell-market-means-for-independent-dealers
22. The Budget Lab at Yale, Fiscal, Economic, and Distributional Effects of 25% Auto Tariffs, 2025. https://budgetlab.yale.edu/research/fiscal-economic-and-distributional-effects-25-auto-tariffs
23. CBT News, CDK Global cyberattack disrupts operations at 15,000 dealerships, 2024. https://www.cbtnews.com/cdk-global-cyberattack-disrupts-operations-at-15000-dealerships/
24. Cox Automotive, 2026 outlook — new-vehicle sales ~15.8 million; slight decline in used retail; ~2% wholesale-index growth, 2025. https://www.coxautoinc.com/insights/cox-automotive-2026-outlook/