Actual car costs???

[Lunk1]

Does anyone have a true idea of the average markup on a new car is? After dealer incentives, holdbacks etc. what is the average markup?

[austinite]

Man, it's been over 15 years since I sold cars. All I remember is that used cars were far more profitable than new. We got paid on the profit back then (I'm sure they didnt show us the real profit), and it ranged anywhere from 3 grand and up. I don't remember seeing more than 6 grand though. Shit ton of money is made when you hit the finance and insurance office.

[MuscleInk]

Markup on new cars:

"This year is a tough year for profit. Avg 3-400 per car. We pick up addl profit in finance."

From VP of sales & marketing at largest Honda Dealership in California.

[Lunk1]

Markup on new cars:

"This year is a tough year for profit. Avg 3-400 per car. We pick up addl profit in finance."

From VP of sales & marketing at largest Honda Dealership in California.

I gotta call BS on this. They receive sometimes thousands of $ back from the manufacture in a number of different ways.

[MuscleInk]

I gotta call BS on this. They receive sometimes thousands of $ back from the manufacture in a number of different ways.

Agreed. It seems lower than I'd expect especially when compensation is largely sale commissions. Remember though.....a lot of profit comes from upgrades. I don't know you'd get an honest answer. Why would dealers want consumers to know their margins on sales.

[diesel101]

I've got a buddy who's in the car business and he claims there is very little mark up on a new car.
Supposedly the money is made with all the extras they try selling(extended warranty,accessories, etc)
They also get a kick back from the finance company

[austinite]

Actually it's not that off. New cars are not what they used to be. This is why it's merely impossible to find a dealership that pays salesmen a percentage commission rate. Instead, they're all paying flat fees with bonuses based on the number of cars sold each month. It's not uncommon for a guy to sell 5 cars at 30k+ each and not even make his draw. Turnover is ridiculous at dealerships today.

New cars pay, but not what they used to pay. Well over 50% of the profits come from banks, not manufacturers. A good percentage is from warranties sold and insurance sales along with accessories. Not much is left for actual profit for the car itself.

[songdog]

All i can say is i dont believe anything a saleman says1

[Rwy]

I gotta call BS on this. They receive sometimes thousands of $ back from the manufacture in a number of different ways.

I doubt this money is shared with Sales People. Probably perk of being owner. I think its 2000-4000 and they make a rip on the rate when they finance.

[JAB1]

My last car msrp was like 55000, dealer paid 46000. I got it for 36000!!! Deal, it was a leftover when new models came out. They showed me the invoice they paid, unless it was fake. Msrp was right on with other dealers.

[FRDave]

www.edmunds.com


Shows MSRP, invoice, true cost to own, average price people in your area are paying, current dealer & manufacture incentives, etc. Best site ever!

[Cuz]

All I know Is I have been ****ed one too many times in the past. I will drive the goddamn wheels off my car before I ever buy another one. Its best to save up cash and buy one from a private seller, like a one owner car. I ****ing hate dealerships.

[Lunk1]

My last car msrp was like 55000, dealer paid 46000. I got it for 36000!!! Deal, it was a leftover when new models came out. They showed me the invoice they paid, unless it was fake. Msrp was right on with other dealers.

Invoice is a joke. All dealers will show you invoice if you ask...they laugh all the way to the bank. Invoice doesn't reflect true cost to the dealership upon sale! There can be thousands left on the table through incentives offered to the dealer by the manufacture, not to mention money from the lenders if you finance through the dealer suggested banks.