How much is reasonable Profit for Car Dealers??

[KapitanE]

Was making some calculations, and I was amazed that the quoy=ted price of a B.M.W. 120I A/T ABS D/AIRBAG 2WD 2DR SOFTTOP is $158800, while basic cost is $105924. That would make a $52876 profit for the dealer.

 

Source: http://www.onemotoring.com.sg/publish/onem...Cost_Update.pdf

 

Then looking at the list again, an AUDI A3 2.0 TFSI QU AT ABS D/AIRBAG 3DR TURBO would have a profit of $54313.

FORD MONDEO 2.3 AUTO 4DR $34559

HONDA ACCORD 2.0L $13842

HONDA ACCORD 2.4L $16633

HONDA CIVIC 1.6L 5AT $15656

HONDA JAZZ 1.3L AT $7176

HONDA ODYSSEY 2.4 A $20083

HONDA STREAM 1.8L SUNROOF ALLOY WHEEL AT $8240

HYUNDAI AVANTE (HD) 1.6 DOHC AT ABS AIRBAG 2WD $12390

 

LAMBORGHINI GALLARDO LP560 $291142

MASERATI GRANTURISMO 4.2 AUTO $139610

 

MAZDA MAZDA CX7 $23257

MAZDA MAZDA3SP LUX $19786

 

and the list go on, do you own calculations....

 

Some dealers makes huge profits, especially those exocit cars, and of course continental cars. So how much profit you think is reasonable?

 

 

[Caravan]

I don't understand why you should be surprised, it has always been like that, save for a few periods when COE dropped and those who bought low managed to get a subsequent high COE (altis at 51k anyone?).

[Incom]

From what i have gathered, generally non conti cars profit margin is about 10K. Margin varies depends on demand. Example: Lancer EX 1.5 profit margin is about < 10K compare to the 2.0 litre version is close to 15K. As with the low COE price, many will consider the 2.0 version as it is much cheaper when compare to a few years ago. Even the out-going Lance GLX, the AD profit margin is also about 10K

 

Generally car prices came down is due to the low coe prices, the dealer's margin is still about the same.

 

Even you can forecast that the COE price is shot up by quite a big amount, at the end of the day the dealer still earn.

 

Just some information sharing.

 

Cheers

[Toapayohkid]

i think ts asked a weird question. how much is reasonable profit? everybody wants to max his profit. how much profit is determine by how easy he can sell.

[Kusje]

The amount of profit they make is governed by demand and supply. If you think they make too much, why don't you start a private importing business to challenge them?

[Incom]

Generally, everyone wants to have a good deal at the of the day. We must bear in mind that the dealer's margin still need to cover the cost of transporting the car, warranty (if new), commission to SE, running cost of the showrooms and etc. Even with demand, the margin is increase, its the consumer who should take into consideration whether the car is worth to get or not.

 

If one thinks that new cars profit margin are high, should look at the margin of used cars.

 

Cheers

[Guest Julio369]

Was making some calculations, and I was amazed that the quoy=ted price of a B.M.W. 120I A/T ABS D/AIRBAG 2WD 2DR SOFTTOP is $158800, while basic cost is $105924. That would make a $52876 profit for the dealer.

 

Source: http://www.onemotoring.com.sg/publish/onem...Cost_Update.pdf

 

Then looking at the list again, an AUDI A3 2.0 TFSI QU AT ABS D/AIRBAG 3DR TURBO would have a profit of $54313.

FORD MONDEO 2.3 AUTO 4DR $34559

HONDA ACCORD 2.0L $13842

HONDA ACCORD 2.4L $16633

HONDA CIVIC 1.6L 5AT $15656

HONDA JAZZ 1.3L AT $7176

HONDA ODYSSEY 2.4 A $20083

HONDA STREAM 1.8L SUNROOF ALLOY WHEEL AT $8240

HYUNDAI AVANTE (HD) 1.6 DOHC AT ABS AIRBAG 2WD $12390

 

LAMBORGHINI GALLARDO LP560 $291142

MASERATI GRANTURISMO 4.2 AUTO $139610

 

MAZDA MAZDA CX7 $23257

MAZDA MAZDA3SP LUX $19786

 

and the list go on, do you own calculations....

 

Some dealers makes huge profits, especially those exocit cars, and of course continental cars. So how much profit you think is reasonable?

 

 

brother, you'll be flame by ADs/ PIs reading your thread. ADs/PIs Vs Buyers who think ADs making big prrofit.

 

for me, 8K plus minus is reasonable for a 1.6 Jap/Kor car.

 

For 2.0, conti and lux car, i don't give a damn because ppl buying this cat are mostly rich.

 

 

[KapitanE]

brother, you'll be flame by ADs/ PIs reading your thread. ADs/PIs Vs Buyers who think ADs making big prrofit.

 

for me, 8K plus minus is reasonable for a 1.6 Jap/Kor car.

 

For 2.0, conti and lux car, i don't give a damn because ppl buying this cat are mostly rich.

 

Flame all they want, this is public information available off LTA.

 

 

[Guest Julio369]

too late, the war started.

so they should blame LTA for releasing the info.

 

 

in fact, our Custom officer should release all the consumer goods cost of importing.e.g. LV, GUCCI, electronics goods etc

[Leepee]

Every businessman wants maximum profit out of the Suckers car buyers in Singapore!

It has always being like this since day one.

Nothing will change. Car buyers will still happily buy!

No amount of persuasion in MCF will make car buyers change their mind.

 

I think its called a Lan Lan catch-22 situation.

 

If one think of forcing the dealers to lower their selling price, it will never work because the business is sustained by many other kan-chong car buyers who would not mind paying the AD's fat fat profit.

When COE at $70k, people still lan lan buy.

Now COE at $7k, people still lan lan buy.

 

Tell me how to convince the whole of Singapore population to cooperate and be united to ask the AD to lower their profit??

 

Ok....I promised you guy.....wait for me to strike 4D or TOTO......with the money.....I will buy a Front page advertistments in ST, ZhaoBao, SinMing, etc to publish the contents of MCF and the profit margins and urge all car buyers not to over pay for the cars ok?

 

 

 

 

 

 

 

[Genes]

Then I guess the majority of car buyers in Sg will remain ignorant for the forseeable future..

[Xxer]

reasonable profits?

 

frm AD point of view : 50k per car sounds reasonable, when at the end of yr, we're answerable to shareholders, which ironically, could be u, if u own Jardine or Tan Chong shares..

 

frm consumer POV: perhaps 10-15k is reasonable... aiyah, dont earn so much lar, blah blah...

 

so in the end, it's a 公说公有理， 婆说婆有理， 到底谁有理，我也不想理

Edited March 6, 2009 by Xxer

[Babyt]

its like discussing why ur coy sld pay u that salary.....

 

 

[Kyojin]

they have to pay for the swanky showroom, PUB, taxes, have to pay the bosses, the SE, the admin clerk, coffee auntie, security guards, mechanics, contractors, advertising, marketing, etc etc. it covers warranty claims too. it's a huge and expensive operation. so it's not really a profit. it's called an operating margin. which is why PI and used car dealers can live with smaller margins.

 

same theory for smaller luxury products. do you think it really costs $5000 for a Gucci bag or that Panerai watch?

 

not to mention that ADs have to take the risk of buying COEs ahead of time.

 

you make it sound like dealers should be operating like a charity. thing is, if you are not willing to part with that huge sum of margin to buy a new car then perhaps you should look at other alternatives like a used car. that one u can determine the "reasonable profit" yourself coz it boils down to your negotiations.

[Guest Julio369]

they have to pay for the swanky showroom, PUB, taxes, have to pay the bosses, the SE, the admin clerk, coffee auntie, security guards, mechanics, contractors, advertising, marketing, etc etc. they can cut down on these frills and pass saving to buyers...but shareholders and directors' fee more impt. it covers warranty claims too this part they claim from factory. it's a huge and expensive operation. so it's not really a profit. it's called an operating margin. which is why PI and used car dealers can live with smaller margins. so shareholder eat what?

 

same theory for smaller luxury products. do you think it really costs $5000 for a Gucci bag or that Panerai watch? that's branded stuff, not bread & butter stuff..think Bonia vs Gucci

 

not to mention that ADs have to take the risk of buying COEs ahead of time.what risk? all are on contracts, buyer back off, forfeit desposits and/ or ganna sued. btw, they get cash from us (via bank loans), not 30, 60 days credit. They may buy car from factory with terms. cash flow where got problem?

 

you make it sound like dealers should be operating like a charity. thing is, if you are not willing to part with that huge sum of margin to buy a new car then perhaps you should look at other alternatives like a used car. dealers not acting like charity because there are still many suckers out there

 

that one u can determine the "reasonable profit" yourself coz it boils down to your negotiations.

Edited March 6, 2009 by Julio369

[Gz0707]

hahaha, good thread, dont worry kena flamed, not happy dont buy loh ... Mondeo started selling at 97k, now after COE "discount", selling at 77k, with room for some more discount, go figure ...

Edited March 6, 2009 by Gz0707

[Gz0707]

u miss out Lancer, i wonder why ...

 

must be the "best" margin out there ...

[Watwheels]

No point being so calculative. From the branded clothes you wear to the handphone you use, you will be shocked to see the cost price. Business is still business, a lot of effort are put into producing and selling the product. Your operation cost to your employee's salary all these dun drop from the sky.

 

The thing is the bigger the car the more profit vice versa for small cars. Cos the thing is that smaller cars are easier to sell compared to bigger cars. On the whole smaller cars can make more profit at the end of the year bcos of the higher sales volume.

 

Unless you live in some communist country where they are critical about capitalism and socialism dan you won't get to see all these high profit margin. Even nowadays they open up their market for trade, if not they cannot survive. Or simply look at North Korea.

Edited March 6, 2009 by Watwheels