As 2025 comes to a close, it’s clear this has been a year that reshaped how automotive retailers think about performance, resilience and decision-making.
At RWA Automotive, we sit right in the flow of dealership performance data every day. Our job isn’t to produce more reports; it’s to help retailers turn automotive business intelligence into practical advantage – a single source of truth that shows what’s happening now, what’s coming, and what to do next.
In this blog, I’ll share the biggest strategic takeaways we’ve seen across the year; what moved profitability in New, Used and Aftersales, where AI is genuinely landing, and the practical priorities I believe retailers should focus on to turn 2026 into an advantage.
The April wage and National Insurance increases were the clearest drag on profitability this year. Most retailers planned for them, but budgeting didn’t remove the reality that hard choices were to follow for most dealerships - simplifying structures, cutting costs and reducing headcount.
In practice, it forced a sharper focus on operational efficiency and management information that leaders could trust day-to-day, not just at month's end.
New cars started strongly with March registrations, but trading softened through the rest of the year for most retailers. The notable exception has been groups that have successfully pivoted towards Chinese new car brands, where the commercial picture has been more positive.
This divergence matters because it’s not just a 2025 story – it’s an early signal of how brand strategy will shape the next five years.
Used cars delivered another good year.
COVID-era supply shortages continued to support margins, but they also made sub-five-year-old vehicles difficult to source.
One of the more important shifts we saw in 2025 was the improving picture for EVs in used car retail. EV pricing and policy discipline have been getting closer to ICE norms, and with the right approach, margins are starting to converge, too.
Best practice we see is around 70% compliance with pricing policies, with room for sensible variation around condition, colour and demonstrators, and crucially, monthly policy reviews in a market that is still changing shape.
This area is core to what we do at RWA Automotive; combining dealer analytics, retail pricing discipline and market benchmarking so teams can act early.
It was also a proud moment to see our PriceSmart and OEM Solution Manager, Laura Murphy, recognised with the Innovation and Technology Award at the Women in Motor Industry Awards this year. A timely reminder that in a market where used values, EV pricing and policy compliance are getting more complex, the winners will be the retailers who combine disciplined processes with smarter, more usable dealership analytics.
Aftersales had a strong 2025, and in years where other divisions are pressured, aftersales focus is often what protects the bottom line.
Our emphasis with customers has been on workshop efficiency (sold vs clocked) and VHC check rates. In 2025, we saw average efficiency move from 98% to 101%, and VHC check rates move from 80% to 82%.
These changes may look incremental, but in a multi-site dealer group, they translate into meaningful, sustainable margin improvements.
For most retailers, 2025 profitability will likely be below 2024 unless they benefited from aftersales growth and/or the tailwind from Chinese new car brands.
The biggest differentiator we’ve seen is simple: actionable information that enables leaders to intervene while the month is still “live,” not retrospective reporting that explains what already happened.
That’s why we launched the RWA Automotive Weekly Flash Report – giving customers a Monday view of month-to-date performance against a relevant cohort across key KPIs (including new and used sales, hours sold and parts sales), so they can act immediately and course-correct in real time.
That innovation, and the impact it’s had for retailers, was recognised when RWA Automotive won IT Innovation of the Year (Data) at the Motor Trader Industry Awards 2025.
2025 has been the year where AI moved from a talking point to day-to-day delivery: automating repetitive tasks, improving lead management, and supporting aftersales follow-ups.
Many people are simply more productive now with Gen AI in everyday use.
The brake on wider adoption is still clean, shareable data. Dealer groups will struggle to scale AI impact unless industry suppliers share data responsibly across technology partners, because without that foundation, automation and insight stay fragmented.
I’m cautiously optimistic about 2026. But the retailers who perform won’t be those hoping for a return to “normal” - they’ll be the ones building for what the market is becoming.
Here are my top five profit priorities for 2026:
Align your estate with where brands are heading, not where they’ve been! That includes Chinese brands and, for some, disposals or acquisitions. We don’t advise on property strategy, but we do see the transformation coming through the data and being on the wrong side will of it will become expensive.
You want a leadership team and culture that’s transparent, open to new ideas, strong on execution and good with people – that includes staff and customers! Change continues to come in fast; legacy ways of working will increasingly act as a brake on your overall performance and profitability if not addressed soon.
Assuming estate and culture are aligned, the next step is a management information system that gives the business one version of the truth, from board level right down to sales, service and parts managers. That’s exactly the gap RWA Automotive was built to fill: uniting systems, reducing ambiguity, and enabling consistent daily decisions rather than month-end surprises.
Our big call for 2026 is used car retention. Many groups track finance renewal, but that doesn’t tell the true used car story. Retained customers are cheaper to market to, they bring part-exchanges, and we typically see around 10% higher profit per unit versus conquest customers.
Across our customer base, we see a clear opportunity: roughly £100k additional margin per rooftop, moving from ~25% used retention to a 40% best-practice benchmark.
Even with the longer-term EV impact on aftersales demand, there are still legitimate levers for margin growth through consistent execution: tech mix, efficiency, VHC completion, service plans, parts margins and the contribution aftersales makes to retention. As a rule of thumb:
What 2025 reinforced beyond doubt is that data alone doesn’t create advantage; action does.
The retailers that outperformed this year didn’t just review results; they shaped outcomes while there was still time to change them.
At RWA Automotive, our focus remains the same: delivering dealership analytics and automotive BI that helps teams run the business in real time with clarity, discipline and confidence.
That’s the biggest opportunity in 2026: build a business that can see clearly, decide quickly and execute consistently, across sales, used cars and aftersales, while the market keeps moving forward and evolving.
If you’d like to see how our automotive business intelligence solutions can drive data efficiency and transform your dealership, please get in touch.
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