Auto dealers are not letting industry headwinds slow their advertising efforts, with retail marketing spend climbing to nearly $10 billion in 2025.
The details: While the year-over-year increase was modest, last year’s spend reflects steady growth in dealer marketing investment since the pandemic, according to the National Automobile Dealers Association (NADA), per Inside Radio.
Dealer ad spending rose 0.4% from 2024 to 2025, reaching $9.96 billion and surpassing the previous record of $9.82 billion set in 2016.
The total also marked a $2.48 billion increase from the pandemic-era low recorded in 2020.
Zooming in: The increase in ad spending was driven in part by stronger dealership performance in 2025, as the average franchised store saw revenue rise 4.5%, supported by higher sales and rising vehicle prices.
NADA said 16.2 million light-duty vehicles were sold last year, up 1.9% from 2024, generating more than $1.3 trillion in sales.
The average new-vehicle selling price climbed to a record $48,205 in 2025, up $553 from 2024.
Dealers also sold 13.1 million used vehicles last year, up 2%, with an average selling price of $28,680.
Stores wrote more than 276 million repair orders, a 2% increase, while service and parts sales topped $164 billion.
Why it matters: The continued rise in ad spending suggests dealers still see marketing as critical to maintaining traffic and market share in an increasingly competitive and affordability-sensitive environment.
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Between the lines: The NADA 2025 figures for spending—which showed average dealer ad spend rising $34 to $739 per vehicle sold—also highlighted several notable marketing shifts.
Digital media accounted for 74.9% of dealer ad spending last year.
Search engine marketing captured one in five ad dollars, followed closely by third-party listing sites.
Social media advertising rose to 14.2% of spend, up from 12.7% in 2024
Most traditional media channels lost roughly half a point of share year over year.
Radio’s share fell to 6.9%, though spending still totaled $687.2 million.
Television’s share declined to 10.5%, or just over $1 billion.
Direct mail’s share fell to 5.6%, while newspaper rose to 2.1% from 1.9% a year earlier.
Bottom line: Dealers continue to shift marketing dollars toward digital channels as competition for shoppers intensifies, signaling that the challenge may be less about spending more and more about spending smarter as customer acquisition costs continue to rise.
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