Will Automotive Market Trends In 2026 Affect Dealership Networks & Dealership Locations?

Key Insights

• Physical dealership buildings have declined from 4,500 to 4,100 over the past seven years as manufacturers seek greater operational efficiency.
• The number of automotive brands has surged by over 35% since 2019, with Chinese entrants like BYD aggressively doubling their dealership networks.
• VR technology is enabling dealerships to reduce physical showroom size, cutting heating and rental costs while maintaining customer experience.
• New automotive market trends mean dealership locations must balance competing demands: customer accessibility versus placement for vehicle deliveries and parts distribution.

Over the past 10 years, there have been, let’s say, a few changes to the automotive industry…

…Technology advancements across the board, including an increase in electric vehicles, AI improvements and even online shopping advancements, are changing the way manufacturers display products and how customers purchase vehicles. 

As a result, physical dealership sites are thinking about strategic reduction, relocation and repurposing to evolve with this new market. 

While the industry is also experiencing major business mergers (such as US retailers acquiring UK dealerships and overseas investment), this article focuses specifically on property portfolio consolidation and dealership location strategy.

The key automotive trends affecting dealer networks in 2026

The physical footprint of the automotive sector is changing. More people now buy cars partly or fully online, leasing and subscription models are reshaping how customers access vehicles, dealerships need new technology for electric vehicles, and the number of brands continues to grow - all of which make it harder to showcase the range people expect in person. These factors combined are forcing dealerships to change the way they work to make more sense to the end buyer, thus increasing profitability. 

Let’s take a look at a few of these trends in more detail…

• Electric vehicles and sustainability

Battery Electric Vehicles (BEVs) continue to gain market share, propelled by stringent regulations, manufacturers' net-zero commitments and a rapid expansion in model choice across price points and segments. This change is fundamentally altering the economics and spatial requirements of dealership operations.

• Physical dealership building decline

Over the past seven years, the number of physical dealership buildings (or "rooftops") has declined from 4,500 to 4,100 as manufacturers seek greater control over the front-end sales pipeline. This consolidation reflects a strategic pivot towards more efficient, multi-brand facilities and alternative retail formats.

• New brands emerging

Traditional brand loyalty is eroding as the number of available brands has surged by over 35% since 2019. New Chinese entrants, most notably BYD, have been particularly aggressive, doubling their dealership networks and filling spaces vacated by legacy brands rationalising their physical presence.

Despite these new trends causing challenges, the physical presence of vehicles is still really important. Most buyers now complete their research online and often visit a dealership with a model already in mind. The role of the showroom has therefore changed from discovery to confirmation, helping reassure the buyer’s decision, reinforce brand confidence, and support the final transaction.

Technology like VR can now be used in dealerships too to showcase different vehicles, features, and customisation options, allowing customers to view and experience cars that aren’t currently on the forecourt - creating a halfway point between viewing online and seeing in person. 

This offers a new opportunity for dealerships to reduce retail store size, making savings on increasingly expensive heating and rental costs. Due to this, location strategy remains paramount, making it a question of “where is best to consolidate?”

Factoring location planning into strategy

As always, nothing is quite as straightforward as it seems. When deciding on location, the first logical step is to look at sales figures. While this is one deciding factor, there are many other important aspects to consider. 

At GMAP Analytics, we take on this responsibility - planning and providing location intelligence for the retail, leisure, and automotive sectors. We have helped some of the world’s most recognised automotive brands and energy companies to make future-proof investment decisions. 

What really matters when consolidating dealership locations…

Dealer areas of representation

Any consolidation decision starts with an understanding of the level of coverage delivered through the network. Dealer territories, usually assigned by postcode, offer a logical baseline - but logic on a map doesn’t always match reality on the ground. The focus should be on confirming that retained locations still reflect real-world customer catchments, preventing gaps in coverage and minimising unnecessary travel.

Retail access versus operational reality

Location decisions often involve trade-offs. City-centre sites may be easier for customers to reach, but can introduce challenges around logistics, space and cost. Out-of-town locations often work better operationally, with stronger transport links and more room for EV infrastructure, but may generate less walk-in traffic. The right balance depends on how each site is expected to operate in the future.

When a dealership is worth more as something else

Not every site should remain a dealership. In some cases, the underlying land or property has greater value when repurposed, whether for logistics, EV charging, or alternative retail use. Recognising when to exit a site can free up capital to invest where automotive retail makes more sense.

Bringing multiple brands under one roof

Housing several franchises in a single location can reduce property costs and simplify operations, from shared workshops to back-office functions. The challenge is ensuring those locations still serve multiple territories effectively without weakening coverage or convenience for customers and minimising intra-franchise competition between the brands sharing the site.

Get this right, and consolidation becomes great for both cost reduction and growth. 

Why data-led location planning is critical

Because dealership consolidation can cost millions and carries long-term operational consequences, getting the decision right is critical. High-level data analysis provides the evidence needed to make those decisions with confidence.

The foundation of sound location planning is understanding demand within a territory. This can be measured through multiple lenses, including the Vehicle Parc, which provides a complete census of vehicles currently owned and driven in a given area, alongside new car registration data and modelled demand based on target customer profiles.

Effective analysis requires granular detail. Vehicle Parc data includes over 30 specific data fields per vehicle record, including make, model, vehicle age, fuel type, engine size and partial postcode. This granularity allows precise mapping of customer clusters and identification of underserved areas or saturated markets.

Performance benchmarking tools, such as used car report dashboards, compare a dealer's internal sales data against the wider territory market. These digital tools highlight where specific sites are underperforming relative to the available opportunity, which is critical when deciding which locations to release.

Finally, predictive data tracking used car disposals (the rate at which people replace their vehicles) signals when a local population is primed for new purchases. Combined with demographic trends, competitor analysis, and brand loyalty modelling (including whether customers are likely to remain in-brand or switch to alternatives), this ensures consolidation strategies are optimised for both today’s and tomorrow’s market.

Using GMAP Analytics for locating your next dealership

Ultimately, location planning comes with high stakes and is a complex task that requires more than just a map; it requires time, dedication and location intelligence software.

At GMAP Analytics, we have the ability to create an Ideal Network Plan. This is a project that uses data to design the most efficient arrangement of dealership locations across a country. 

As a reseller of the DVLA anonymised automotive industry data set, we provide world-leading data that isn’t available to the general public. We can also provide tools such as MVPLUS, which turns complex spreadsheets into easy-to-read visual maps - showcasing your entire network's strengths and weaknesses.

Location matters. Take control of your decisions with empirical data. Contact GMAP Analytics now, and let us turn insight into action.