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The biggest thing that skews the numbers you mention is that there are dealers that regularly get what we in the business call head rippers. Let's just say that you sell 10 cars, and 9 of those cars show a gross of $1,000, and the 10th one is a head ripper (seriously, anyone who actually pays MSRP on a vehicle with a $25,000 mark-up deserves it - and I'm looking at Jeep / RAM purchasers) that makes $11,000, suddenly you're at a $2,000 average for those 20 vehicles.

Keep in mind I said we TRY to make that. There's lots of times we make a LOT more than that. And my question is, are they also including back end numbers with that, because that's store profit as well. If we make $1,000 up front, then between financing and warranty, they make $1,500 in the back, we consider that $2,500 a copy. And it really helps my paycheck when I get $3,500 in the front and $3,500 in the back. (Hey, I have to make a living, too.)
The F&I profits are completely different reporting categories and not included in the numbers I quoted. The new car market is 17 million cars in the States and I will guarantee you one out of every 20 of those did not make the dealer $25,000 and skew the entire industry averages. I have had several stores exceed those numbers on a yearly basis without even one of those urban myth "head rippers".

At the end of the day dealers make far less than the public imagines but more than the gross profits you are passing along. This is exactly why it is so unprofessional for people in the industry to attempt to rationalize profits and quote numbers. Most dealership employees don't have a true understanding to begin with and the public doesn't believe and simply think it is additional proof we are all liars. The truth is simple. Can you buy it cheaper somewhere else and if not this must be a "good deal".
 

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2018 Outbacks, Grey Premium & Silver Limited
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The F&I profits are completely different reporting categories and not included in the numbers I quoted. The new car market is 17 million cars in the States and I will guarantee you one out of every 20 of those did not make the dealer $25,000 and skew the entire industry averages. I have had several stores exceed those numbers on a yearly basis without even one of those urban myth "head rippers".

At the end of the day dealers make far less than the public imagines but more than the gross profits you are passing along. This is exactly why it is so unprofessional for people in the industry to attempt to rationalize profits and quote numbers. Most dealership employees don't have a true understanding to begin with and the public doesn't believe and simply think it is additional proof we are all liars. The truth is simple. Can you buy it cheaper somewhere else and if not this must be a "good deal".
This is whay I don't get into these conversations myself be it in person or online. They go nowhere and usually foster suspicion and negative perception. Furthermore I don't see how anyone who is or has been in the car business benefits or frankly anyone else.
 

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2017 2.5i Premium Lapis Blue
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This is whay I don't get into these conversations myself be it in person or online. They go nowhere and usually foster suspicion and negative perception. Furthermore I don't see how anyone who is or has been in the car business benefits or frankly anyone else.
That's pretty much it. Profit seems to be a four-letter word these days. At least until you tell someone they get paid too much for the job they do. Then suddenly making money is okay.
 

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They go nowhere and usually foster suspicion and negative perception.
With good reason. I believe Carl when he says he can pull the actual invoice for any given vehicle and that is what the dealer pays. But few want to talk about the automaker to dealer spiffs which when spread across sold vehicles effectively reduces the price of vehicles.

It is also very easy these days to check out the annual reports of publicly traded auto groups like Auto Nation and CarMax to see their reported profit per vehicle.

I like to see it discussed in order to educate the large of the number of folks that believe dealers sell large numbers of vehicles below cost.
 

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With good reason. I believe Carl when he says he can pull the actual invoice for any given vehicle and that is what the dealer pays. But few want to talk about the automaker to dealer spiffs which when spread across sold vehicles effectively reduces the price of vehicles.

It is also very easy these days to check out the annual reports of publicly traded auto groups like Auto Nation and CarMax to see their reported profit per vehicle.

I like to see it discussed in order to educate the large of the number of folks that believe dealers sell large numbers of vehicles below cost.
I bought my 2017 Subaru outback $2800 below (supposed) invoice cost. And there were three dealers fighting for my business.

And trust me that was the price quoted on email without much haggling. I showed it to my local dealer but he would not budge. So I bought in another town 200 miles away.

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