Just How Much Is That Dealer Making On Your New Car Purchase?

Dealer Holdback is an amount paid to the dealer by the manufacturer for each new vehicle sold. It may be calculated as a percentage of Invoice Price or Manufacturer’s Suggested Retail Price (MSRP) including or excluding options, or as a fixed amount, and the calculation and amount varies across manufacturers. A typical estimate is 2 percent of the total vehicle Invoice, though the actual amount of the Dealer Holdback can actually range from zero to 3 percent of the total vehicle Invoice.



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Dustbuster - 6/28/2011 4:34:42 PM

+2 Boost

Agreed. Dealers are so in tune to making deals, the last new car I bought was haggle free as they offered a very fair price out of the box. A 3-5% profit is low when most "normal" businesses make 30%. And only in the car business can you find invoice prices. Try that when you buy a TV at Best Buy and ask for below invoice =)

commander104 - 6/28/2011 6:29:35 PM

+2 Boost

I was just in my local Honda dealer and speaking to a salesperson and he said customers like the dealer b/c the salespeople are salaried NOT commissioned so no haggle and a pleasant no pressure experience.

BrandyS - 6/29/2011 1:17:25 AM

+1 Boost

Hey Agent009, thanks for picking this up and running with it!