What's the mark up on a new car?

horseofstone

I know it probably varies from brand to brand and it would depend on the car size too but take for example a new 21 hyundai Tucson, how much profit would their be on it? I've heard their's more profit to be made on a new suv compared to say a saloon car.

Midnight_EG

horseofstone wrote: »

I know it probably varies from brand to brand and it would depend on the car size too but take for example a new 21 hyundai Tucson, how much profit would their be on it? I've heard their's more profit to be made on a new suv compared to say a saloon car.

The number varies but its not what people think... There isn't thousands upon thousands profit anyway.

biko

There is profit yes, but not much.

Are you wondering how much you can try to haggle down?

horseofstone

biko wrote: »

There is profit yes, but not much.

Are you wondering how much you can try to haggle down?

Yeah I was wondering is their much room for negotiation. If for example I offer 300 euro less on a 30k plus car for example what will the garages reaction be.

Toyotafanboi

Be very lucky to get the guts of €1k out of a new Tucson when all is said and done.

Outkast_IRE

Its strange times for some garages depending on brand.
One of my family members works in a Skoda garage and essentially the PCP price is the best price they will do , even if you walk in with a bundle of cash they will only match the PCP price.

Buddy Bubs

horseofstone wrote: »

I know it probably varies from brand to brand and it would depend on the car size too but take for example a new 21 hyundai Tucson, how much profit would their be on it? I've heard their's more profit to be made on a new suv compared to say a saloon car.

I can see what you mean by more profit on a SUV as they are more expensive than car they are based on, Ford Kuga being closely related to Ford Focus for example but being in same price territory as the Mondeo........Tucson is probably same as i40 inside but dearer

Howver, theres no hard and fast rule, I remember reading something about BMW being unable to make a profit on cars under 40k euro or something but they have to provide them to keep the brand name out there and the people buying the base models of small cars now are the future buyers of the ones they make a killing on......thats profit on the manufacturer end....but every manufacturer will be different.......some make their profits in the 20k cars

I worked in a main dealer for a short time as trainee accountant and I remember profit margins on a car with no extras being 8% if I am not mistaken, then theres decent money in upselling extended warranties, service packs, additional extras which could more than double the profit margin on a car, nowadays the protective coating seems be a big upsell for those on PCP so they can return them in good condition and get maximum resale, and the return to invoice insurance must be hugely lucrative too.

Then the real profit for a dealer comes in the form of rebates for hitting targets, fail to hit this regularly and they will go bust very quickly and lsoe their franchise.

carsfan2

Toyotafanboi wrote: »

Be very lucky to get the guts of €1k out of a new Tucson when all is said and done.

Seems a very small return for the amount of work involved in selling a car.

Midnight_EG

carsfan2 wrote: »

Seems a very small return for the amount of work involved in selling a car.

New cars don't require selling... If a person is interested, they're buying it anyway.

FintanMcluskey

Worked in an main dealer for a an agri brand many years ago.

The profit on new sales was minimal and warranty on trade ins was a pain in the bottom.

Parts sales and service was more lucrative.

The dealership always budgeted towards its bonus from the manufacturer which was based on certain targets, new units sold etc

I was told the car industry was similar, the manufacturer bonus is where the profit is

Toyotafanboi

carsfan2 wrote: »

Seems a very small return for the amount of work involved in selling a car.

This is it.

The money is in the bits on a new car; finance referral, GAP insurance, SMART insurance, Lifeshine, protection pack, extended warranty etc.

Then there's rebates for selling so many, you might get an additional €100 back from the manufacturer per vehicle if you sell x amount of them.

Then if you buy there, you are more lifely to come back for warranty, service, trade in down the line etc.

Used cars are much more lucrative.

jimbobmalones

It's similar to a bottle of wine in that a huge percentage of the purchase price is tax. Both VAT and VRT. Add in cost of manufacturing the car transport etc and there is a thin margin leftover

Phil.x

But dealers are selling lots of cars. One junior rep I was talking to said he was expected to sell 18 cars per month and the senior guys upto 30 cars per month. He said he easily surpasses the required 18....I couldn't believe the figures. (Nissan, Airside)

Jim_Hodge

Toyotafanboi wrote: »

The money is in the bits on a new car; finance referral, GAP insurance, SMART insurance, Lifeshine, protection pack, extended warranty etc.

How come then that in changing my car every two or three years for about 30 years none of those were even suggested to me?

Bez Bing

Jim_Hodge wrote: »

How come then that in changing my car every two or three years for about 30 years none of those were even suggested to me?

Same as. I bought a new car this year and when I brought up a service plan the rep told me not to bother prepaying for it.
He didn’t mention any of the other insurances or extras.

Toyotafanboi

Jim_Hodge wrote: »

How come then that in changing my car every two or three years for about 30 years none of those were even suggested to me?

Maybe you're a cash no bits kinda fella :pac:

Way too many variables to give a direct answer.

Some brands will offer better margin on their cars than others and some models carry better margin again, maybe the margin is getting them by.

Some dealers gouge you on your trade in, some are just looking for another unit towards their rebate quota, some may have someone looking for a car like you are trading in, some are just thankful for your business.

I see with a lot of smaller dealers, usually family owned and operated places like doing more old fashioned deals and feel bad pushing these upsell items onto their loyal, repeat customer base.

Others are just couldn't close a door never mind a sale with a few accessories on it. Whatever about some of them, there is an appeal to having gap insurance and service plans usually work out cheaper than paying on the day.

colm_mcm

A lot of that shoite only became popular in the last 5 years.

jelem

Look at uk price in pounds and convert to euro then take that from irish price.
gives you an idea **** as uk sellers will have their own mark up on the price you use
from their advertising.

colm_mcm

jelem wrote: »

Look at uk price in pounds and convert to euro then take that from irish price.
gives you an idea **** as uk sellers will have their own mark up on the price you use
from their advertising.

What about VRT, and VAT differences?

Bez Bing

Bez Bing wrote: »

Same as. I bought a new car this year and when I brought up a service plan the rep told me not to bother prepaying for it.
He didn’t mention any of the other insurances or extras.

If you’d pressed him, he’d probably have thrown it in for free.

Casati

Toyotafanboi wrote: »

Be very lucky to get the guts of €1k out of a new Tucson when all is said and done.

They are offering a 3500 eco upgrade so I’d imagine they will drop close to this buying straight with no trade in?

AMKC

Buddy Bubs wrote: »

I can see what you mean by more profit on a SUV as they are more expensive than car they are based on, Ford Kuga being closely related to Ford Focus for example but being in same price territory as the Mondeo........Tucson is probably same as i40 inside but dearer

Not at all. The New Tucson is totally different inside to the now old i40. The old Tucson was different inside too. Maybe you mean with mechanicals but even they were and now are different on the two Hyuandais.