Five Oh Brian

Hi, Tony. I'm happy to give you all an insider's view into the inner workings of a dealership. That's one of the biggest reasons I will not divulge which dealership I work for.

We sell a very high volume of new and used vehicles. We're a top 10 volume Ford dealer in our region (150+ dealers in our region). Most of our business is repeat and referral business, and we win all the big customer satisfaction awards, so we're treating people right. There are some months when we post a loss on new car sales, but most of the time we make a little bit of money. Certainly not enough to justify staying in business, but the used cars, service dept, parts dept, and body shop all contribute to make the store profitable enough to justify opening the doors every day.

I was reading an article in one of the industry periodicals a few days ago that shows that for the entire auto dealer body in America (all brands, foreign and domestic) that the average net profit on a vehicle sale after expenses and labor costs for a car dealership is about $250 for a used vehicle, but new vehicles average a loss of about $30 per vehicle sold. So, it isn't just where I work, or even just at Ford, but industry wide.

Tony Alonso

Thanks again for the insider info!

Excellent!

Which part is most profitable at your place (if you don't mind sharing)?

Amazing...

In short, would you say that any Bullitt ADMs, were that to be a trend, would not really buy your dealership much?

Five Oh Brian

Not sure which dept is the most profitable at our place (I'm only involved in the sales end of things). I'm not sure I follow your last question, but I don't believe for a minute that there will be any trend toward Bullitt ADM's. However, I think any good dealership would strive to have competitive pricing, whether it's close to invoice, close to MSRP, at MSRP, or an ADM. Make money where you can while staying competitive, and forego money where you have to for volume's sake.

edcrbnsoul

Another Dealership $5k ADMU I smiled said thanks anyway and walked out the door.

Jager

Say what you will about the pricing but seems like the new Dodge is comming soon:

"The 37,995 dollars will buy you a Black, Silver or HEMI Orange car with a 6.1 liter HEMI V8 engine, numbered dash plaque and 'carbon-fiber' hood stripes."

I'll stick with the Bullit.

05fordgt

Actually the Challenger is $40,095, as per the price on Dodge's website. The price Chrysler announced didn't include the GG tax.

jsaylor

Back when I sold Volvos are most profitable area, by far, was the service department. As you have stated new car sales weren't particularly profitable. If I recall the last year I was there profit was about 300k 'in the front'. Of course, we made more than ten times that in the service department so that wasn't a problem.

ShelbyDude

$37,995 will buy you a Challenger "IF" you can find one for that.

Rumor I hear is Dodge dealers around here want $80K for one!

I will sell our Bullitt to anyone that wants it for MSRP.

I see some dealers are saying $3K - $5K over.

ShelbyDude

Have you checked to see what Dodge dealers will sell one for?

Around us they are wanting $80K +

RCSignals

Those with mark up will only be sold to people who live with a bag over their head

05fordgt

Shelbydude, I already posted SEVERAL places on here saying "good luck getting a Challenger for MSRP", meaning your going to pay an ADM. Plus my quote you replied to, was my reply to someone who posted the original price that Chrysler announced a few days ago. All I was posting was the price off the website, not what they will ulitmately be going for.

jay_wx

Wow, that is really stupid asking 80K for a Challenger, thats Viper territory. And I believe the 08 Viper has 600 hp....

c25sailor

My dealer advises that they don't expect to have ADM on the Bullitt

05fordgt

Well, its offical, Ford is allowing all "Plan" sales to be used on the Bullitt.

jay_wx

Wow, thats cool!

Jager

Great news Jeff!

AFBLUE

Cool. Now you just got to find dealers that will take them. I'm sure they are out there.

edcrbnsoul

I'm slowly expanding my circle that I'm calling, all of the dealers I have talked to so far have told me at least 3k over and "they can only get one its a limited addition and they are only making a few so I better get one quick if I find one."

Five Oh Brian

Worth noting is that while Ford is now including Bullitts for plan sales, you still have to find a dealership willing to honor a plan sale.

Let's take X-plan, for example. If a dealership sells a Bullitt on X-plan, the X-plan price is roughly the same as the invoice total so there is $0 profit for doing this. However, Ford pays a commission to the dealer for handling the X-plan sale, but that commission is only $565.

A/Z plan is similar. A/Z plan price is about $1,200 below invoice total, but the Ford commission back to the dealership is about $1,800, so the dealership only makes about $600 selling on A/Z plan.

So, if a dealership can only get a couple of Bullitts, and there are customers OK paying MSRP (which is about a $2,200 profit over the invoice total), which would most dealers choose to do?

Jager

Good info Brian! Now if only I can find a dealer willing to move on MSRP.