Some operators are growing concerned over slowing Automotive ad spend in 2024. However, the sector is poised for a strong rebound in 2025 as auto brands return to capitalize on AM/FM. That’s according to BIA Advisory Services.
BIA Managing Partner Rick Ducey addressed the dip in a webinar on Thursday, blaming political ad spending during the presidential election cycle.
Ducey explained that the automotive sector, particularly local spending, has decreased by about 2.3% this year. This decline is largely driven by the high volume of political ads, which are taking up a significant portion of ad inventory across all media, including radio. Although the auto industry has overcome many supply chain issues, and interest rate cuts are stimulating demand, political spending has crowded out much of the automotive ad space in 2024.
Despite this temporary dip, automotive advertising remains a major force, especially in digital. In 2024, total automotive ad spending is expected to reach $12 billion, with about 56.8% going toward digital media. Ducey highlighted the growing appeal of connected TV and over-the-top platforms for auto advertisers, with automotive ranking third among industries investing in Connected TV advertising.
In comparing subverticals like auto repair, tires, and parts, Ducey noted that while auto repair ad spending remains stable, tires and parts show more variability. In 2024, tire and parts spending is expected to dip slightly, from $705 million to $685 million, before bouncing back to $721 million in 2025.
The media mix for automotive repair and tire stores also varies. Desktop advertising dominates for both subverticals, but mobile and over-the-air TV also play significant roles. For tire stores, mobile is a top channel, while automotive repair relies heavily on desktop, TV, and mobile.
Ducey also pointed out the increasing use of mobile and digital ad technologies, which help automotive brands target consumers more precisely. Data from SalesFuel indicates that consumer behavior—such as searching for products online, clicking on ads, and ultimately making purchases—aligns with the media mix automotive brands are using.
In summary, while political ad spending is suppressing automotive advertising in 2024, the sector is set to rebound in 2025. Automotive brands will continue leveraging digital platforms, radio, and mobile to reach consumers and regain market share. Radio remains a critical component in the media mix, especially as local automotive dealers look to maintain visibility in competitive markets.
