# Cost price of a new VW Polo ?



## 182_Blue (Oct 25, 2005)

Anyone know what a VW dealer gets say a £12,000 polo for from Volkswagen ?, the only reason i ask i have been offered the chance to buy a VW at the price they pay from VW, so i just wanted to know if it was real or just a sales gimmick.


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## Tom H (May 20, 2009)

From my time a few years back in car sales the sales person will make about 30-50 quid commission and the garage will be on about 3% but they rely on getting bonuses for selling a certain amount etc... I may be wrong about the exact amounts for this manufacturer but it's not much!


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## 666 (Dec 4, 2010)

i no at Suzuki the dealership only earn a few hundred per car


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## nokia (Mar 3, 2009)

wow, i didnt realise it was that low. Thought it would have been a grand or so.


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## Supermega (Nov 10, 2008)

That's why they flog lifeshine for £300 a pop!


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## 182_Blue (Oct 25, 2005)

nokia said:


> wow, i didnt realise it was that low. Thought it would have been a grand or so.


Yes it seems very low, especially considering i have had thousands of new cars ?


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## j3ggo (Dec 7, 2011)

I would say around 10% if they sell at full rrp. When I bought my golf new they discounted but did not really want to sell as they had to put on number plates and pdi. I bought 2 new golfs one for me and one for my dad and they were not keen to demo the car for my dad. I had to show him. They might make only £100. They sell at discounted prices to turnover cash and get numbers to get discounts and increase their status in league tables.


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## SteveTDCi (Feb 8, 2006)

I cannot remember what discount we get on a polo, I think it's 15%, there are some cracking deals on fabia's at the moment, which IMO is a better car,


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## The_Bouncer (Nov 24, 2010)

Dealer margin on RRP is dependant between marque

Average is 13%


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## Bero (Mar 9, 2008)

I really really doubt that's all they make! You would struggle to run a business on that margins! My sister gets a 15% discount if she buys a new VW......so I assume the dealership make more than that on a regular car.


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## 182_Blue (Oct 25, 2005)

SteveTDCi said:


> I cannot remember what discount we get on a polo, I think it's 15%, there are some cracking deals on fabia's at the moment, which IMO is a better car,


What deals are on?


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## The_Bouncer (Nov 24, 2010)

Don't get confused by Manufacturer discounts, discounts on finance etc etc.

Dealer margin is as I said, average 13% and you'd be very lucky to extract any of that from them

:thumb:


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## 123stevevw (May 19, 2008)

-R- said:


> What deals are on?


No VAT (20% discount) on Fabia's. PM me spec and I'll see what deal I can do for you.

I'm a Sales Exec for Skoda main Dealer.


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## SteveTDCi (Feb 8, 2006)

I think you can get the skoda Fabia vat free, the se model is something like £8995, I guess it depends on if you want to px something or not. I don't know what the fleet discount is on the skoda, I can check thevw terms tomorrow. I know we get excluded on the 60ps version. The dealer I use can supply vw or skoda, if you want the details I can pass them on but cannot promise they will be the cheapest as I've never used them for retail.


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## woodybeefcake (Oct 12, 2008)

Nah they don't make much on _all_ of the cars. A lot of it is made in after sales like service where the markup on parts and labour is more like 45%!

It could be correct OP. One of my company's Mazds branches recently sold about 20 pre-reg Mazda 3's at cost just because they have to sell X amount to satisfy the quoted agreement of the franchise.

Same with my Abarth. If I went and ordered one it would be around £16k iirc. Pre-reg on the curerent 12 plate it was £13k. With staff discount I paid about £11.5k which I thought was an epic bargain for a brand new car!


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## DampDog (Apr 16, 2011)

When I bought mine a little over 12 months ago, I managed a 10% discount on the TSi, which I thought was quite good at the time considering stock on that particular model was all but non-existent. They also had an offer of free insurance for 12 months so I thought the deal was reasonable. He also did me some staff discount on some bits and bobs for the car. So maybe not a brilliant deal but OK.

Deals may well depend on stock levels assuming you're not prepared to wait for new car build week. If they are up to their necks in a particular model they may well need to shift some metal and be more generous with discounts.

I would say shop around, first couple of dealers I visited were not intrested in budging on price at all, just wanted to push finance, GAP and lifeshine.


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## woodybeefcake (Oct 12, 2008)

I believe the free insurance is still available on the Polo for anyone over 21!


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## justina3 (Jan 11, 2008)

bouncer imo is very close, i dont a deal with a local vw garage not so long ago where we fitted sat navs and phone kits and all they had in the deal was 9%


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## justina3 (Jan 11, 2008)

Bero said:


> I really really doubt that's all they make! You would struggle to run a business on that margins! My sister gets a 15% discount if she buys a new VW......so I assume the dealership make more than that on a regular car.


Most main dealer's income derives from bodyshop, parts, servicing and second hand cars.


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## Scotty Pro (Nov 12, 2008)

Best to go and buy one towards the end of the month, salemen will sell it cheaper than at the beginning of the month to hit their targets. My mates a car salesman and he gave me that tip, although I didn't go to his place


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## justina3 (Jan 11, 2008)

a lot of garages now have 1/4 targets as there sales men used to do stupid deals just to hit targets


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## andy665 (Nov 1, 2005)

Long gone are the days when you know how much profit there is in a car. Most dealerships don't know if they have made a loss / profit until the end of each quarter.

It generally works like this:

1. % margin on new cars - can vary dependent on model / range - totally up to the dealer how much they want / need to give away

2. Quarterly bonus money - again can vary by model / range. If dealer hits target they get bonus money x number of cars sold. If they over-achieve they can get extra money, sometimes back to the first car sold in the quarter. One manufacturer I do work with imposes a £20k per quarter penalty if they do not retain a certain % of existing customers - that can easily make the difference between a profit or loss being recorded

3. Dealer standards money - extra money that can be earned (or lost) for good Mystery Shop scores, CSI (Customer Satisfaction) scores, dealer audits (that covers such basics as type of biscuits offered to customers, make of waste bin in coffee area - I'm not joking here) etc

4. Sometimes manufacturer "offers" require a subsidy from the dealer as well as from the manufacturer - the dealer has no choice

Its become massively complex and its impossible for a Sales Manager. let alone a sales exec to know how much profit they have made until well after quarter end and the accountants have done the calculations.

Its actually very hard to make money from a franchised dealer operation - a 1.5% - 2% net profit on turnover is a great result - thats including aftersales business

A lot of dealerships budget to lose money on new car sales as it generates a steady supply of used cars and workshop business


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## DampDog (Apr 16, 2011)

That's really interesting and quite scary really, it's probably why you see so many garages come and go nowadays.

Also backs up the shopping around for a deal approach, different garages may have very different priorities at any give time.


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## Maggi200 (Aug 21, 2009)

Every VW dealer I've visited has always seemed like they would rather not bother selling any cars. 

Ive dealt with accounts for a couple of clients, who were small franchises, and the margins as said, that I saw at least, we're minimal and staff appeared to be into pressure selling and topping sales up with additional services. However, they also managed to retain custom according to management. 

I wouldn't believe being told a polo was 'at cost' if a salesman was trying to sell to me, even if the offer was the result of a monumental **** up. I'd imagine even at cost the polo doesn't represent great value for money?


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## andy665 (Nov 1, 2005)

Average customer retention in franchised dealerships in the UK - less than 20% - if dealers concentrated on good service they'd retain more - absolutely shocking really.

Also customers need to accept that if they want the best in service then they need to accept that it costs £ to deliver

The work I do currently is looking at customer retention and dealers are chronically poor. Was looking at a customer in a prestige German franchise yesterday

Customer had a 3 year old Mercedes E250 CDi that they bought at 12 months old and had 9 months payments less

Because of manufacturer support money that customer could go into an E63 Estate with no cash in and no increase in monthly payments , anything less than an E63 and he'd either reduce his payments or get cashback

Dealer could not be bothered contacting the customer to make him aware of the deal on offer


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## buckas (Jun 13, 2008)

£50 a car commission my brothers mate gets at local Audi dealers (and he's the top salesman) - thought it'd be more after he told me


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## SteveTDCi (Feb 8, 2006)

I would happilly pay more for a car from a dealer for better customer service, I would buy based on the salesmen being nice, not fake but just a genuinely nice person to deal with. My seat came from a small seat dealer up north, he offered to tax and register the car to me despite me never having seen or driven it, he took a chance and so did I. Now I'm looking at adding seat on to our fleet list and he will be the first dealer I contact about supplying the car. Discounts don't matter as they we get manufacture support so for them it's an order and deliver process.


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## Skodaw (Mar 19, 2006)

A lot of manufactures now only give a handling fee. Skoda do it with the Citigo and te fabia and it's between £450 & £500 per car, out of that comes the sales commission the cost of valet, fuel and pdi. So at the front end it's not good, but its a registration towards target and that's where te back end bonus comes, but as has been stated before its nt easy to tell when the dealership is doing profitable deals.

Also sometimes there will be deals that mean a dealer will not make any money unless they shift a minimum number of cars.


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