Quote:
Originally Posted by NH Dan
Try dividing the margin you quote by 10 and you'd be much closer to the dealer margin for a civic.
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I think 3-4% sounds low since a clear purchase signal with a reservation on the price often get 5% discount more or less without asking. But the margin may be quite different for different dealers - and of course different cars. A "cash cow" such as the civic will have much less margin on each unit than the S2000.
But the point is that I was intentionally
very optimistic, as I wanted to be able to put 20% discount and still be able to show that even if you have a very large marigin you need to increase the sales unreasonably much to earn the same amount of money.
If the margin is 22% you'll have to increase turnover with roughly 1000% to maintain 20% discount/price decrease without losing money.
Looking at the price list of options gives me the feeling that Honda make more money selling options than selling the car itself though.