Where Car Dealership and Powersports Ad Spend Is Heading

Car dealership ad spend is shifting toward automated, video-first formats faster than creative production has caught up, while powersports spend is simply getting more expensive for the same output. This page tracks that medium-mix shift with 2026 figures rather than repeating a generic creative-format benchmark table.

Key Takeaways

• 86% of auto marketers plan to increase CTV spend in 2026.
• 75% plan to increase digital display and video spend in the same period.
• Per-dealer Performance Max conversions rose 82% year over year.
• Per-dealer PMax spend rose only 27% in the same window.
• Google Search still draws 64% of network channel spend at franchised dealers.
• Average dealership ad spend reached $586,246 a year, up 7.8%.
• Spend per new vehicle sold hit $739, up 4.8% year over year.
• The ad-to-sales ratio fell to 0.77%, down from 1.00% a decade earlier.
• Social media advertising is 14.2% of dealership budgets.
• Third-party listing sites take 20.0% of dealership budgets.
• Powersports paid search CPC rose 19.3% in 2025 alone.
• Top 10% of dealer stores turn inventory 54% faster than average.
• Fragmentation across platforms worries 78% of auto marketers most.
• 57% of auto marketers use generative AI for data analysis already.
• BMW dealers lifted per-store ad spend 29%, the fastest of any brand tracked.
• Display's share of conversions continues to slide industry-wide.

The medium shift: video and CTV over local TV and print

Innovid's 2026 Automotive Advertising Outlook, surveying auto marketers directly, found 86% planning to increase CTV spend and 75% planning to increase digital display and video spend, describing the category as "video-first" for the year. That growth is coming out of local TV and print, which the same report describes as losing share because they deliver less flexibility, less scale and weaker performance signals than connected formats.

The gap between stated intent and completed reallocation still matters for anyone producing creative right now: an 86% planned increase is a budget signal, not evidence every dealership has already shifted its production pipeline to match.

The automated-format efficiency signal: Performance Max

Fullpath's Q2 2026 Auto Intelligence Index, analyzing digital-advertising trends across its network of franchised dealerships, found per-dealer Performance Max conversions up 82% year over year while per-dealer PMax spend rose only 27% in the same window, a roughly three-to-one gap between conversion growth and spend growth. Google Search remained the backbone of dealership investment at 64% of network channel spend, with PMax now the network's third-largest channel at $2.69 million, behind Search and Social at $3.04 million. Display continued to slide and Social's share of conversions softened even as its spend held steady.

That efficiency gap is the clearest signal in the 2026 data for where creative production time should go first: automated, multi-surface formats that are converting faster than the media buy is growing, not the formats losing conversion share while holding spend.

What the dollars actually add up to

NADA's latest annual financial profile puts average dealership advertising spend at $586,246 a year, up 7.8% over the prior year, and $739 per new vehicle sold, up 4.8%. Despite that dollar growth, the ad-to-sales ratio has fallen to 0.77%, down 23% from 1.00% a decade earlier, because vehicle transaction prices have risen faster than ad budgets have. Inside that total, search engine marketing takes 21.1%, third-party listing sites 20.0%, SEO and website optimization 19.5%, social media 14.2%, TV 10.5%, radio 6.9%, direct mail 5.6% and newspaper 2.1%.

Creative production budgets, in other words, are being asked to service more channels for a shrinking share of a growing revenue base, which is the underlying pressure behind the shift toward automated, multi-surface formats above.

Powersports is moving in the opposite direction: costlier, not more efficient

LeadVenture's 2026 State of the Dealer research, built on behavior across 6,800-plus dealership websites, found powersports paid search cost per click up 19.3% in 2025 while click-through and conversion rates both fell, meaning the same creative and targeting cost more to run for a smaller return. The report frames 2026 as a year of "disciplined execution" rather than budget growth: the top 10% of stores generate 4.5 times more leads and turn inventory 54% faster than average, driven by execution quality, not bigger media spend.

For a creative team serving both categories, that is the central planning fact: dealership budgets are chasing efficiency gains in automated formats, while powersports budgets are absorbing cost inflation on formats that already exist, which argues for spending creative hours on response and merchandising fixes before new powersports ad units.

The AI layer creative teams are already using

Innovid's outlook also found auto marketers using generative AI most often for data analysis (57%) and campaign optimization (43%), with creative personalization still an emerging rather than dominant use case. The leading concern is fragmentation across platforms and publishers (78%), followed by cross-channel measurement complexity (56%), which tracks with the shift toward automated formats like Performance Max that are designed to manage fragmentation on the advertiser's behalf. Separately, 85% of auto marketers in the same survey say cross-channel orchestration matters, but most report lacking the systems to actually coordinate decisions and unify workflows across every platform they now run creative on, which is the practical reason a single generic ad-format benchmark is worth less to this pairing than a channel-level efficiency read.

The vehicle base this spend is chasing

The population of vehicles behind this ad spend keeps growing, which is part of why dollars are rising even as efficiency ratios fall. The Auto Care Association's 2026 Factbook projects the U.S. light-duty vehicle parc will exceed 301 million vehicles by 2029, up nearly 10 million from 2025, with total auto care industry revenue reaching $676.5 billion by 2029. Powersports Business, covering the same LeadVenture dealer research cited above, frames 2026 as a year in which "the dealers winning aren't outspending the competition, they're out-executing it," a framing that argues for spending creative hours on execution quality across a growing vehicle base rather than simply increasing spend to match it.

Why this pairing cannot borrow a generic automotive benchmark

WordStream's 2026 Search Advertising Benchmarks report shows why blending dealership and powersports spend into one automotive line hides the real picture: Automotive Repair, Service and Parts, a completely different buying category, posts one of the lowest search cost-per-lead figures of any industry at $29.96, while the dealership and powersports figures above show rising costs and shifting formats. A creative budget cannot be planned against a single "automotive" number when the sub-categories inside it are moving in opposite directions.

What this means for a 2026 creative brief

• Prioritize video and CTV assets first for car dealership work; 86% of the category is already planning to spend more there.
• Feed Performance Max asset groups before adding new static display units; it is converting three times faster than its budget is growing.
• For powersports, spend the next creative hour on merchandising and response fixes, not a new ad format, since rising CPC is a cost problem the current creative is already absorbing.
• Build creative to be measured across platforms from the start; fragmentation is the top concern for 78% of auto marketers surveyed.
• Do not average dealership and powersports performance into one "automotive" line when reporting to a GM or ownership group; the two categories are moving in opposite cost directions this year.

The two categories also differ in where the AI layer above is actually being applied: Innovid found auto marketers turning to generative AI for data analysis (57%) and campaign optimization (43%) well ahead of creative personalization, which means the automated efficiency gains documented in Performance Max are currently a targeting and bidding story more than a creative production story. That is likely to change as tools mature, but a 2026 creative brief should still budget human hours for the asset variety Performance Max asset groups require, rather than assuming AI creative tools have already closed that gap.

Our performance creative team builds asset groups against exactly this kind of channel-efficiency data, and our guide to Google Ads pricing covers the search-and-PMax spend side in more depth. If your creative budget is still split evenly across formats that are not converging the same way, talk to us about rebalancing it.

Frequently Asked Questions

Is video creative actually replacing other formats for car dealerships?

Budget intent says yes, faster than execution has caught up. Innovid's 2026 Automotive Advertising Outlook found 86% of auto marketers planning to increase CTV spend and 75% planning to increase digital display and video spend, while budgets shift away from local TV and print. That is a stated intention across the category, not yet a completed reallocation at every store.

What is actually driving dealership ad spend growth right now?

Automated, multi-surface formats more than any single creative unit. Fullpath's Q2 2026 Auto Intelligence Index found per-dealer Performance Max conversions up 82% year over year while per-dealer PMax spend rose only 27%, meaning the format is converting roughly three times faster than its budget is growing. Google Search still absorbed 64% of network channel spend in the same period, so PMax is additive, not yet dominant.

How much is a dealership actually spending on advertising in 2026?

NADA's most recent annual financial profile puts the average franchised dealership's ad spend at $586,246 a year, up 7.8% over the prior year, or $739 per new vehicle sold, itself up 4.8% year over year. That total sits inside an ad-to-sales ratio of 0.77%, down from 1.00% a decade earlier, so spend is rising in dollars while shrinking as a share of revenue.

Is powersports creative spend behaving the same way as car dealership spend?

No, and the difference matters. LeadVenture's 2026 State of the Dealer research found powersports paid search cost per click up 19.3% in 2025 while click-through and conversion rates fell, meaning the same creative and targeting are simply costing more to run. Powersports stores are absorbing rising media costs at the same time car dealerships are shifting budget toward higher-efficiency automated formats.

Where should a limited creative budget go first for this pairing?

Toward the format with the clearest efficiency signal in the published data: Performance Max for car dealerships, where conversions are outpacing spend growth roughly three to one, and toward fixing lead response before adding creative spend for powersports, where rising CPCs are compounding an existing 44-out-of-100 industry response score rather than a creative problem.

Sources

_{Innovid - 2026 Automotive Advertising Outlook
Fullpath - Auto Intelligence Index, Q2 2026
NADA - 2026 Annual Financial Profile of America's Franchised New-Car Dealerships
LeadVenture - The State of the Dealer 2026, via Motorcycle & Powersports News
Vulcanax - Dealership Advertising Spend, 2012-2025
Auto Care Association - 2026 Auto Care Factbook and Lang Annual
Powersports Business - LeadVenture State of the Dealer coverage
WordStream/LocalIQ - Search Advertising Benchmarks by Industry, 2026}