| How can a dealership sell a car at a price that is close to their invoice price and still make a profit? |
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Dealerships can sell a vehicle at a low price that is close to their actual invoice price for any of a variety of reasons: -The dealership may be receiving additional money back from the manufacturer in the form of a "holdback" for selling a certain volume of cars. -Dealer gets "holdback" from the factory which might be up to 3% of MSRP -The dealership may be receiving additional money back from the manufacturer in the form of a "dealer cash" for selling a certain volume of cars. -There may be a factory-to-dealer rebate for the car they are selling. -The dealership may be making its profit from the financing of the vehicle, extra products or accessories you are buying rather than from the selling price of the vehicle. -The dealership may be making its profit from its Service Department rather than from its Sales Department. Because the dealership has these alternate means of making a profit, selling a vehicle at a price that is close to their invoice price is usually not a problem for them. You can find invoice price here. |
