How do second hand car dealers make money?

How do car dealers make money on a daily basis i dont think they sell a car everyday?

  • THERE LIKE MILLIONS OF DEARLSHIP OF CARS AND NOT EVEN MULTI BILLIONAIRS BUY CAR ON A DAILY BASIS JAY LENO IS AN EXCEPTION AND I M SURE REPAIRS COMES IN LIKE EVERY ONCE IN A BLUE MOON SO HOW DO THEY PAY THEIR BILLS

  • Answer:

    There is no need to "shout" or type in all caps. There are not millions of dealerships. Ford only has about 4,000 nationwide. They pay their bills with parts sales and repairs. And repairs happen more often than not. If you buy a car they'll give you a schedule of maintenance that should be done on it at various intervals. Many people not knowing that they can get the same service for cheaper and not violate the warranty by going someplace else (as long as the mechanics are ASE certified) will come back to the dealer. So you buy a car and then over the course of the next 100,000 miles come in for the maintenance and pay for it. Not to mention that the average dealership's mechanics bays are usually full. Either by the aforementioned maintenance or with repairs of cars that are beyond their warranties. They also pay their bills based on a number of cars that they sell per month. A dealership knows that they need to sell "X" number of cars and do "Y" dollars in service and repairs in order to break even. That's what the markup in the costs of the cars and in the repair work is for.

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You have to realise that car salesman are commission workers (usually) they gain a percentage of a sale on a car as their salary, now that may be as little a $150 and up (depending on the car price) they are basically just careful with their money and know that if they dont sell a car by the time this money runs out then they may be broke, obviously people are good with finances and saving and such too, so this can also be relevant. But if the salesman works at something like a "Ford" dealership or something, alot of those guys have an hourly wage because it's a big corporation. Also, if they are having trouble sellng cars, they will sometimes cut they're loses and sell older models to a used car dealership down the road to make back a little bit of their losses.

DVSnmeSON

A small dealership sells 20-60 cars a month, with an average of 800-2,000 dollars profit per, repairs come from not only the cars sold, but all cars in the area that people bring to that dealership. also they can add %1 to your interest rate, thy also get a small cut when they sell you extended warranties and "gap" insurance and car dealers don't "own" new cars.... they buy the car with a loan and pay their care note and a basic type of insurance daily on the car. In my 3 years selling cars I averaged 14 cars a month, some I only got $100, most I got $300, and every now and then I would earn 1-$2,000

Common Sense Dictates

well if your talking about the emmployees, they get paid on comisssion, which means they get like 10% (im not sure on this figure and it would fluctuate on experience etc) of the total sale of the car. but they also get like a base wage with isnt a whole lot, so like if you dont sell a car, you dont make that much money, but you still have cash to take home to the wife and kids. if your talking about dealler ships, well if its a ford dealership, ford would support them, because all the money from all the dealships goes into the company and goes out to pay bills, if its an independent dealship, then yes they rely heavily on sales, and they probally would sell more cars because they have mainly used cars, and more people buy second-hand cars every day then new cars. so big compaines, all the gross national/state earnings to pay for bills independent rely on selling cars, if they dont sell cars they trade them into other car dealler ships

phillipingzzz

They do not need to make money on a daily basis. None of their costs are paid on a daily basis, salaries weekly or monthly, rent and business taxes paid quarterly or monthly. In the UK main dealers sell most of their new cars in February and August to coincide with the new registrations, and then sell secondhand cars mostly on weekends in-between.

Bigsumo

Servicing. More money is made from people who bring their cars in to be serviced at the dealership than from actually selling the cars in the 1st place.

Flamethrower

Over pricing the cars they do sell.

LEE - WHU-

By selling. They sell cars they also sell Finance, Parts, Service, Accident repairs, Rental or contract maintenance, Accesories the list goes on and on.

Dean

The average salesman sells 7 cars a month. How do they make money on the 23 days they don't sell cars ? PS, its not by typing in ALL CAPS like a lobotomy patient.

Never

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