The Internet has exploded in recent years, so you'd think Internet sales per dealer would have blossomed, too.
Not true, according to research by the National Automobile Dealers Association. Internet sales are flat or slightly down at the average dealership, NADA says.
So many dealers are jumping online with Web sites, they are simply dividing up the available business, the association says.
The latest statistics from NADA show that since 1997, the number of new-vehicle sales generated from Internet leads has averaged five units per month.
The average number of used-vehicle sales from online leads actually dropped to two units per month in 1999, compared to three units per month in 1997 and 1998.
MORE DEALERS PAY SERVICES
The numbers are difficult to explain because close to 100 percent of the dealers surveyed devoted employees to handling online inquiries and keeping the sites up to date.
And more dealers are paying online buying services to send them Internet leads. This year, one in two dealers subscribes to an Internet referral service, up from one in five dealers in 1997.
The sites also have come a long way since two years ago, when many of them were about as interactive as a local phone book. Now, 93 percent of the sites let customers e-mail the dealership, 72 percent allow shoppers to browse vehicle inventory and 42 percent let customers schedule sales and service appointments.
While these more sophisticated sites are drawing more traffic, the increase has not shown up in higher per-dealer sales.
MOST HAVE WEB SITES
NADA thinks sales-per-dealer figures have been stagnant because more dealers are online. The number of dealerships with Web sites has climbed to 74 percent, up from 47 percent in 1997.
The total of Internet sales at all dealerships was not available from NADA.
The association blames the dip in used-vehicle sales on dealers' recent tendency to wholesale more used cars. 'Dealers have been so busy this year that they simply send more cars to auctions,' said Paul Taylor, NADA's chief economist.
New-vehicle sales might be low because some dealers are confused about how to count Internet sales, said Taylor. Some might count only the transactions that are handled completely online, while the vast majority of sales initiated on the Internet are completed in the showroom.