Australians are keeping their cars longer as dealer margins stay thin and EV demand remains patchy

A lot of money is being transferred to Australia’s car dealers; the latest industry data from the Australian Automotive Dealer Association (AADA) shows many are operating on far fewer margins than most buyers would assume.

Released as part of today’s AADA event, where Australian Prime Minister Anthony Albanese promised dealer protection reforms would be delivered this year, the association’s Dealernomics 2026 figures show why the sector is pushing so hard on unfair trading practices, unfair contract terms, and supplier indemnification.

The topline numbers are large enough to be a big number for . Australia has 3868 dealerships, 64,045 dealer employees and 7508 apprentices according to the AADA. Its industry makes $211 from . The economic activity of 5 billion is $91 billion, generating $81 billion. It’s $8.3 billion, with sales and turnover of 3 billion; – $$8 billion). A total of 2 billion in tax and duty, another $8 per cent for . dealer wages of 2 billion in s.

And that’s how little after the bills are paid, but those headline numbers do not show up until they leave it. The AADA’s benchmark $100 million dealership based on gross profit is $14 per cent, according to the company. A million 0 million A1$ is spent on finance and insurance. It is a total of 65 million for s, and $2. 65 million. It includes total costs of $14 per cent for . Paraphrasing 8 million,.

childcareman.xyz can save you thousands on a new car. Click
here
to get a great deal.

The result is a net profit of $3.50 million, or 3.5 per cent of turnover.

That’s because it is important that dealers keep focusing on issues that may be abstract outside the industry, but can make a real difference inside the business.

For example, 56 per cent of gross profit is employee costs alone, or $7. According to the AADA’s benchmark model, 8 million is a parody of its . A floorplan interest of 8 is. 1 per cent, or 0 percent) of . Onemillion 1 million . Rent $1. 8 million. A further 5 are advertising is ads. 0 per cent,.

The money is actually from just as important, the money comes from . Two-thirds of turnover is 72 per cent for new vehicles, 12 percent for used retail and 2 perc. for use wholesale. 0 per cent,. 86 per cent of dealership revenue comes from front-end sales combined, according to . The remainder 14 per cent are parts and service.

And that is the story behind the gross profit split – but it’s another story. For example, front-end operations make 53 per cent of gross profit and used vehicles 10per cent for 43 percent of total gross revenue. For example, parts are 13 per cent of total gross profit (and 34 percent) and back-end operations account for 47 per Cent of all the overall gross profits.

In other words, parts and service do far more heavy-lifting than their share of revenue suggests.

That’s why the political battle over warranty reimbursements, audit clawbacks and consumer-guarantee costs have become such a big deal for dealers. But if the workshop and parts department are carrying almost half of gross profit load, disputes over who pays when something goes wrong hit harder than many outside industry might realise.

Mr Albanese made that point directly in his speech.

“A dealer should not suffer a financial loss for doing the right thing by the customer.”

Also, he said ‘We know we need to protect consumers from unfair practices and have to defend dealers as well; it starts with unfair trading practices. – ’.

The timing of that argument is not accidental, because the customer backdrop is getting tougher too.

According to the consumer sentiment survey of AADA’s electric vehicle (EV) consumers, 65 per cent of respondents said they would be able to keep their current car for longer because it is under cost-of-living pressures. A further 65 per cent said their next purchase will be an SUV or a ute.

Only 38 per cent said they would be willing to buy an EV for their next main car. Further down the line, 13 per cent said they were ‘very likely’ to buy an EV as their main car and 25 percent that they had been very likely. At the other end, 17 per cent said they were not very likely and 21 percent that they weren’t at all likely.

The survey also contains a telling number the average price premium consumers said they would pay for an EV was 2; there is another one. 0 per cent . Meanwhile, 60 per cent said governments should be encouraging customers more to switch to EVs.

The arguments buyers gave for not considering an EV were also familiar with the reasons they offered to buy. Evs still cost over the top, according to 50-three per cent of. The right home charging setup was not provided by another 43 per cent, and a further 44 percent said there were no public charging stations or infrastructure.

There were 36 per cent cited for driving range, 33 percent on recharge times and 32 Per cent at repair. The price of insuring an EV is too high and 26 per cent said another 27 percent (27 perc) that resale values will not hold up, while one-fourth percent added the cost to sell an ‘EV’.

But it’s also a trend in the used-car market that is showing up for that lack of , as well as that reluctance. The AADA says in 2025, a total of 2,316,208 used cars were sold down 0 (down 0-1) according to the ADA. Nationally, 37 per cent of s are national. ofThose, 51 per cent of those – s. Private sale 4 per cent and 48 percent were private sales. dealer sales 6 per cent were dealer sale.

In addition, 1,422,518 of those used car sales were petrol cars (1.422)5,588) or 61 (60) vehicles (2.220-558) and Petrol automobiles (3.8 million). 1 per cent, a market share of 4 percent for . There were 725,203 sales of diesels (or 311) for the year. Paraphrasing 3 per cent. Hybrids surpassed 128,914 sales, or 58,000-954 for hybrids. 6 per cent.

The sales of used EVs were 33,610 (or 11) for use. Approximately 5 per cent of the market for . The PHEVs did not make sales of 2950, or 1 0. One per cent.

This explains the ageing of Australia’s car fleet, which has been under parody from . In the AADA data, there were 20 s with. In 2025, 9 million registered vehicles were registered nationally (up from 20) and a total of 9million registered cars. During 2024, 4 million s were created. And that’s about 764 cars per 1000 of people, up from 757 the year before.

A passenger vehicle age of 11 on average increased to 11, . Nationally, 3 years from 11 to 13 years. – 2 years in 2024? Light-commercial vehicles grew on average from an age of 11 to 11. 4 to 11 . 6-year-old .

This is a sign that the industry is being asked to “take more complexity” at one point when buyers are holding onto cars longer, the national fleet is getting older, used EVs remain largely part of the second-hand market and much of if he or she still sits in the service lane rather than the showroom.

AADA chief executive James Voortman made that point in the association’s media release.

But he said ‘As local new car dealers are squeezed, it will be Australian customers that pay for the price as they invest less in local jobs and cut access to regional communities.

He also warned the growing number of auto brands in Australia has not translated into better returns for dealers.

There have been 28 brands based in Australia over the last five years, including . Nevertheless, an increase in the number of brands has not led to increased profits for s. We certainly don’t want to end up in a situation where we’re seeing dealerships closed, and local jobs lost.” Mr Voortman said ‘If this trend continues today it is not likely that I would be looking for someone who has been working at the same company as me or her husband of an older age group but still wants us to see them on my side with their own words.

That is the real tension in the numbers released today.

Australia has a large dealer industry in the field of . It is a economically important . Today it still employs tens of thousands of people and trains thousands more apprentices, including .

But it’s also a business where if you buy. $100 million, the only money that comes in is 3 at all. 5 per cent of turnover, where nearly half of gross profit comes from the back end, and where a customer base under living cost pressure is not moving to EVs as fast as policymakers or auto brands might like.

MORE:
Australian prime minister says car dealer protections are coming soon as AADA ramps up pressure

Thanks for reading Australians are keeping their cars longer as dealer margins stay thin and EV demand remains patchy