New Car Dealers (United States) — NAICS 44111

An investor's primer for the NAICS industry level. NAICS (the North American Industry Classification System) code 44111 is the five-digit "industry" for New Car Dealers. It contains exactly one six-digit child, 441110 (New Car Dealers), so this level and that child cover the same businesses. This is a short rollup page: it gives the figures the federal statistics report at the 44111 level, then points you to the full 441110 primer for the detail.

1. Overview

A new car dealer is the storefront where a factory-built vehicle meets a retail buyer. Under U.S. law, almost every new car and light truck from a traditional automaker is sold through an independently owned, franchised dealership — not by the manufacturer directly. That legal structure makes new car dealers one of the largest and most stable retail industries in the country: roughly 17,000 franchised dealers sold about 16.2 million new vehicles in 2025 [1].

Because NAICS 44111 has only one child industry (441110), the two levels are effectively identical — same firms, same economics, same investable universe. Everything an investor needs sits in the child primer; this page exists to record the level's own official statistics and to route you there.

2. What's inside — and why the level equals its one child

NAICS is a nested hierarchy: each five-digit industry is subdivided into one or more six-digit national industries. New Car Dealers is one of the cases where the subdivision does no work — the five-digit industry 44111 maps one-to-one onto a single six-digit child:

With a single child, there is nothing to aggregate: the count of firms, the receipts, and the employment reported for 44111 are the same numbers reported for 441110. In practice these are franchised dealers — stores operating under a franchise agreement with an automaker, the OEM (original equipment manufacturer, i.e., the carmaker) — each typically bundling four businesses under one roof: new-vehicle sales, used-vehicle sales, a finance-and-insurance (F&I) office, and a service-and-parts operation. Adjacent activities sit in other codes and are not counted here — used-only lots and the large used-car retailers (Used Car Dealers, 441120), parts and tire retailers (441330 / 441340), independent repair shops (NAICS 8111), and the automakers themselves (3361–3363), including direct-selling brands such as Tesla, Rivian, and Lucid. See the 441110 primer, section 2, for the full scope and exclusions.

3. How big it is (this level's rollup figures)

Federal business statistics reported at NAICS 44111 (our ground-truth figures) — identical, at this level, to the single child:

Two things to read from these figures. The Census receipts of $1.19 trillion count everything a new-car dealership sells — new vehicles, used vehicles, parts, and service — which is why the number dwarfs the roughly $620 billion consumers spent on new vehicles alone in 2025 [1][4]. And there are more establishments (21,910) than firms (17,242) because the larger dealer groups run many locations under one company [4][5].

Undercount caveat. County Business Patterns and the Economic Census count employer businesses (those with paid employees) and exclude nonemployer sole proprietors [5]. That exclusion bites in industries dominated by tiny individually owned operators; here it is largely immaterial, because franchised new-car dealerships are payroll-intensive, corporately owned, and captured well by federal statistics. As a cross-check, the Census firm count (~17,242) lines up closely with the National Automobile Dealers Association (NADA) tally of roughly 16,900 franchised light-vehicle rooftops [1][2]. A quirk of labeling, not coverage: the Small Business Administration (SBA) treats any dealer with 200 or fewer employees as a "small business," yet the typical franchised store employs around 65 people and rings up tens of millions in annual sales — so most dealerships are "small" only on paper [6].

4. Investable universe — where the value sits

Because 44111 equals its one child, the investable map is exactly the 441110 map. Value concentrates in a small number of large operators sitting atop a very long private tail:

• Public franchised retailers (six): Lithia Motors (LAD), Penske Automotive Group (PAG), AutoNation (AN), Group 1 Automotive (GPI), Asbury Automotive Group (ABG), and Sonic Automotive (SAH) — the pure or near-pure ways to own the industry in public markets, with 2025 revenues ranging from roughly $15 billion to $38 billion each [9][10][11][12][13][14].
• Large private groups: Hendrick Automotive Group (the largest privately held group, ~$14.5 billion 2025 revenue), Berkshire Hathaway Automotive (owned by Berkshire Hathaway, BRK.A / BRK.B), and others such as Ken Garff, Morgan Auto Group, and Holman [15][16].
• The long tail: thousands of family-owned single- or few-store operators. Even the 150 largest groups sold only about 27% of new vehicles in 2025 — the majority remains with independents [17].

Full company detail, revenue table, and the private-market routes are in the 441110 primer, section 4.

5. How the money works

At this level the economics are the dealership model, unchanged from the child. A store is best understood as four profit centers, 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 share of gross profit; finance and insurance (F&I) is a high-margin add-on desk (arranging loans and leases and selling service contracts and GAP — guaranteed asset protection — coverage); and fixed operations (service, parts, and collision) is the profit engine, a modest share of sales but roughly half of total gross profit because the work recurs regardless of the sales cycle [2][18]. The metric that ties it together is service absorption — fixed-operations gross profit as a share of total overhead. Net margins are thin at the store level (commonly 1–3% of sales) but sit on tens of millions of revenue per rooftop. The mechanics, with per-unit figures, are in the 441110 primer, section 5.

6. Demand drivers

New-vehicle demand is cyclical and rate-sensitive; the drivers are the same at 44111 as at the child. The main levers: affordability and financing (most buyers finance, so the monthly payment governs demand — average transaction prices crossed $50,000 in late 2025, with new-car loan rates near 6.7–6.8%) [21][22]; the macro cycle (a vehicle is a big-ticket discretionary purchase, so sales track employment, confidence, and credit); fleet age and replacement (the average vehicle on U.S. roads hit a record ~12.8 years in 2025, a tailwind for both replacement and the service bays) [24]; manufacturer supply and incentives; and product and powertrain mix, including electric vehicles (EVs), which are dominated by direct-selling brands that largely bypass franchised dealers [25]. See section 6 of the child primer.

7. Regulation

New car dealers are among the most legally protected retailers in America, and the protection is the industry's defining feature. Rules come from three layers: state franchise (dealer-protection) laws in all 50 states, which in most cases bar automakers from selling new vehicles directly and require sale through independent franchised dealers; manufacturer requirements imposed through the franchise agreement; and federal consumer-protection rules from the Federal Trade Commission (FTC) and others, plus safety and emissions oversight from the National Highway Traffic Safety Administration (NHTSA) and the Environmental Protection Agency (EPA) [26][27][25][22]. The FTC's 2024 CARS Rule (Combating Auto Retail Scams) was vacated by a federal appeals court in early 2025 and formally removed, effective 2026, so it is not in force — but scrutiny of F&I markups and add-on fees continues [23][24]. The single biggest regulatory question is whether state franchise laws survive the direct-sales and "agency model" push tied to the EV transition. Full detail is in the 441110 primer, section 7.

8. Consolidation

This is a genuinely fragmented industry, and the federal concentration data reported at this level make the point: the four largest firms held just 8.4% of receipts in 2022, the top eight 12.7%, the top 20 16.4%, and the top 50 20.5%; the Herfindahl-Hirschman Index (HHI, a standard concentration gauge where 10,000 is a monopoly) was a mere 25.4 — about as un-concentrated as any large industry gets [4]. That fragmentation is the investment thesis for the big operators: with thousands of independent stores and a steady supply of retiring owners, the public groups and large privates can grow for years simply by acquiring, through the "buy-sell" market at "blue sky" earnings multiples [17]. Section 8 of the child primer covers the dynamics.

9. Risks

The risk profile is the child's: cyclicality and interest rates (financed big-ticket purchases fall in downturns; higher rates also raise the dealer's floorplan financing cost on unsold inventory); margin normalization off the 2021–2022 inventory-shortage peak [18][20]; the EV / direct-sales threat to the franchise model [25][26]; OEM dependence on a manufacturer's product, allocation, and incentives; regulatory and litigation risk around F&I and advertising [23]; tariffs and input costs, with 2025's 25% auto tariffs adding an estimated $2,000–$6,000-plus per affected vehicle [27]; and technology-vendor concentration, underscored by the 2024 CDK Global ransomware attack that disrupted roughly 15,000 dealerships [28]. Full list in the 441110 primer, section 9.

10. How to invest, and the outlook

Because 44111 is identical to 441110, the routes and outlook are the same. Public route: the six franchised retailers (LAD, PAG, AN, GPI, ABG, SAH) — 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, and acquisition returns) rather than headline revenue. Private route: because most of the industry is private, the more direct exposure is owning the asset — buying a rooftop or group (subject to OEM approval), developing and leasing dealership real estate, or providing floorplan and acquisition financing. Outlook: a mature but durable industry, with new-vehicle sales expected to run near a 16-million-unit annual pace; direction hinges on interest rates, affordability at record prices, and the trajectory of 2025's tariffs, while the durable service, parts, and F&I lines plus a still-fragmented, consolidating market keep it attractive [1][21][27]. The full how-to-invest checklist and outlook are in the 441110 primer, section 10.

For everything beyond this summary, read the full leaf primer: NAICS 441110, New Car Dealers.

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Sources

1. National Automobile Dealers Association (NADA), "December 2025 Market Beat: New Light-Vehicle Sales Totaled 16.2 Million Units in 2025," 2026. https://www.nada.org/nada/nada-headlines/december-2025-market-beat-new-light-vehicle-sales-totaled-162-million-units
2. 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
3. U.S. Census Bureau, 2022 Economic Census — Summary and Concentration Statistics for NAICS 441110 (receipts, firms, CR4/CR8/CR20/CR50, HHI), 2024. https://data.census.gov/table/ECNBASIC2022.EC2244BASIC
4. U.S. Census Bureau, County Business Patterns 2023 — NAICS 441110 (establishments, employment, payroll), 2025. https://www.census.gov/data/datasets/2023/econ/cbp/2023-cbp.html
5. U.S. Small Business Administration, Table of Small Business Size Standards (NAICS 441110), 2023. https://www.sba.gov/document/support-table-size-standards
6. Lithia & Driveway (Lithia Motors, LAD), "Fourth Quarter and Full Year 2025 Results," PR Newswire, 2026. https://www.prnewswire.com/news-releases/lithia--driveway-lad-reports-fourth-quarter-results-and-full-year-results-302684520.html
7. Penske Automotive Group (PAG), "Fourth Quarter and Full Year 2025 Results," 2026. https://investors.penskeautomotive.com/news/news-details/2026/PENSKE-AUTOMOTIVE-GROUP-REPORTS-FOURTH-QUARTER-AND-FULL-YEAR-2025-RESULTS/default.aspx
8. AutoNation (AN), "AutoNation Reports Fourth Quarter and Full Year Results," Business Wire, 2026. https://www.businesswire.com/news/home/20260205773353/en/AutoNation-Reports-Fourth-Quarter-and-Full-Year-Results
9. Group 1 Automotive (GPI), "Fourth Quarter and Full Year 2025 Financial Results," 2026. https://www.group1corp.com/2026-01-29-Group-1-Automotive-Reports-Fourth-Quarter-and-Full-Year-2025-Financial-Results
10. Asbury Automotive Group (ABG), "Fourth Quarter and Full-Year 2025 Results," 2026. https://investors.asburyauto.com/press-releases/21341
11. Sonic Automotive (SAH), "Fourth Quarter and Full Year Financial Results," Business Wire, 2026. https://www.businesswire.com/news/home/20260218554758/en/Sonic-Automotive-Reports-Fourth-Quarter-and-Full-Year-Financial-Results
12. Hendrick Automotive Group, "Corporate History" (2025 revenue and units), 2026. https://www.hendrickcars.com/corporate-history.htm
13. Berkshire Hathaway Automotive, "About Us," 2026. https://www.berkshirehathawayautomotive.com/about/index.htm
14. Automotive News, "2026 Top 150 Dealership Groups," 2026. https://www.autonews.com/retail/top-150-dealership-groups/
15. 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/
16. Automotive News, "Decline in dealership pretax profit slowed in final months of 2024," 2025. https://www.autonews.com/events/nada-show/an-nada-dealership-profitability-snapshot-2024/
17. 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
18. Experian, "State of the Automotive Finance Market — average auto loan rates," 2025. https://www.experian.com/blogs/ask-experian/auto-loan-rates-financing/
19. 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
20. 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/
21. 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
22. Federal Trade Commission, "Used Car Rule," 2016. https://www.ftc.gov/legal-library/browse/rules/used-car-rule
23. 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
24. Federal Trade Commission, "Withdrawal of the CARS Rule" (Federal Register notice), 2026. https://www.ftc.gov/legal-library/browse/federal-register-notices/revision-negative-option-rule-withdrawal-cars-rule-removal-non-compete-rule-conform-these-rules
25. National Highway Traffic Safety Administration, "Laws & Regulations," 2026. https://www.nhtsa.gov/laws-regulations
26. U.S. Environmental Protection Agency, "Regulations for Onroad Vehicles and Engines," 2026. https://www.epa.gov/regulations-emissions-vehicles-and-engines/regulations-onroad-vehicles-and-engines
27. 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
28. CBT News, "CDK Global cyberattack disrupts operations at 15,000 dealerships," 2024. https://www.cbtnews.com/cdk-global-cyberattack-disrupts-operations-at-15000-dealerships/