Dodge dealership commission Question?

When you get some time, Miguel, listen to this show I'm posting a link to. A radio station spent one month at Town & Country Jeep, Chrysler, Dodge, in Long Island, documenting vehicle sales and the sales staff. Since all Jeep, Chrysler, Dodge dealerships are treated the same by their parent company, this program will especially informative for you, and answer your questions, from an insiders look .

They don't make "commission" at all. The dealership buys a car from the maker and sells it at a higher price. That's markup, not commission.

There is a lot of markup and the dealer has a lot of room to move within that markup. But you won't get them to come down from 27k to 23.

The dealership has costs to cover and they're in business to make money, not to do you a favour.

Salesmen tend to lie. But, some dealers do pay on shear numbers of cars sold only.

According to what I read on here.

When I was a dealer, 15+ years ago, almost all were on some form of commission. The more the dealership makes, the more the salesman makes. And that's probably the norm in many areas.

That's why stuff like Extended warranties are such ripoffs. Nearly all profit and they warranty very little in reality.

They are at least 50% profit for the dealer who shares 1/3 to 1/2 with the salesman.

When I was a dealer, salesman tended to make 25% of the profit on a used car after a "pack" which was intended to cover their overhead.

Way back when, if they paid $8,000 for a car and spent $500 fixing & cleaning for sale, the salesman would get 25% of the profit over $9,000. Excluding doc fees. Back then, the dealer charged a $500 pack. I wouldn't be surprised if that's not $1000+ by now.

The average salesman, back then, sold about 5.5 cars a month. And many didn't sell that many and ended up quitting or getting encouraged to find other work. (They would outright fire you if necessary, particularly if you ask about min wage and time and a half. (If you cant earn your wage, you wont be around long)

Now, in really high volume dealerships, it might be different. And I'm pretty sure places like CarMax don't pay commission. Or they didn't used to. I cant imagine the wage is very good at all.

Don't worry about the sales people, you need to worry about buying that Car you want.

The salesman's commission isn't any of your concern. The DEALER sets the prices on the cars he sells, NOT the salesman.

Assume anything a car salesman tells you during the car buying process is complete bullshit.

Of course they make money, on every single car they sell. If they lost money on the sale of every car they sold they wouldn't be in business very long.

Having said that they DO NOT make a lot of money per unit sold. There isn't a lot of markup on brand new cars. So they have to rely on large volume of sales to make their money.

You should not expect a $4000 discount on your car. That is way too aggressive. 10%-15% maybe but not 20% off.

Car dealers are usually on a sliding scale for buying the cars. It is not a commission scheme at all. The dealer buys the car from the maker and then sells it to you at a profit.

The more cars they sell over a period agreed in advance the more discount they get from the price they have to pay and with that they can earn more money or make better deals for their buyers.

Better to stop trying to overthink it. It is a really simple thing. Dealer buys car, dealer sells car to you for more than they paid for it - that is their profit. They choose that selling price. You can choose to go elsewhere if you think it is too high. That is a free market economy. They are a company with overheads and will HAVE to make a profit to remain in existence.

How old are you?

How many cars have you purchased though private sales?

How many cars have you purchased at a dealer?

New or Used? If used how many miles?

Trim level?

All good info to post.

Setting that aside, I love it when the dealer starts explaining the commission system to the customer, I really, really find it amazing, and the fact for some reason it seems to work. There is some psychology there that they are trying to say....We are partners here, let me give you all these details.

Sure I hope everyone I do business with makes money, but when my cable company doubled my rate in 12 months they did not act like we were partners. If the dealer overcharges you and you get a bad deal on the loan, they really don t care, they just want to sell the car.

The way the dealer chooses to manage it commission process does not matter to you, it is like if the sales guy wanted to spend 20 minutes explaining their heath car employee options or how they manage their employee schedules, not germane to your purchase.

1. Shop and price the car at 3+ dealers. The same trim level. Go back and forth to get the best price.

2. Let them know you are shopping.

3. Ask for a written deal sheet with all the details of the transaction. When you get the contract, read it WORD FOR WORD, take to a private room, without the F&I guy hovering over you and trying to rush you, and say...Oh it is just a contract, sign here, I have other customers waiting. Fine go take care of them, I will let you know when I am finished reading the contract.

If the contract varies from the deal sheet then reject the deal and tell them to re-work it and get it right.

4. Never allow the dealer to front you a vehicle. You can do a search that.

I doubt it. Usually salesmen get a percentage, perhaps 25%, of the dealer's profit on the sale. There are a multitude of other additional schemes the dealer might use to increase sales, including a bonus if the salesman sells over a certain number of cars in a month or succeeds in selling a car they can't shift. Sometimes if there is little or no profit in a deal the salesman might get a minimum bonus of $100 or so instead of commission, just for shifting the car.

Oh boy, you're a sheep waiting to be fleeced for sure. You don't know the game at all, but there are all kinds of ways they make money on a car and all sorts of smoke-and-mirror tricks to fool you into thinking you're getting a deal, and all sorts of other tricks to fool you into thinking they can't go any lower on price.

One thing is sure. I KNOW you're really young so (a) you probably can't really afford a 2017 Challenger, especially when you add in the monthly insurance premium. If you haven't got any insurance quotes yet you had better hold your horses on buying until you know EXACTLY how much that's going to cost for full coverage collision with uninsured / under insured motorist coverage, glass coverage, and at a "deductible" you can afford. The deductible is the amount you pay out of pocket if you have to make a claim, no matter whose fault it is. You could end up paying almost as much for insurance as the car payment itself and insurance is a required part of financing a vehicle. Default on either you insurance payment or loan payment and they can repossess the car with as little as one late payment. FACT.

In addition to insurance and knowing the sales game trickery, you need to know EXACTLY how much financing is going to cost you. If you're not careful, you could easily wind up paying a high interest rate for such a long period that it will put the actual price of the car well above $30,000. It depends on your age, credit rating, employment history and many other things including how much of a down payment you can make. If it's anything less than about $5000-$6000 down and more than 48 months financing, you're going to get really hosed on interest and within a year or two you'll owe far more than the car is worth. You absolutely want to avoid loan terms that will put you "underwater" anytime during repayment. Therefore you need to crunch the numbers yourself, or get someone to do it for you. Do NOT let the dealer / salesman calculate it for you.

The bottom line is that you don't know ******* about buying a car, so you had better get help from someone who really knows the routine inside out. Either that or stuff your ego back into your pants and buy a 4 year old Honda Civic.