Do dealers make more on consignment than dealership owned cars?

I'm not sure what Ferrari dealers charge on consignment, but when we take a car in on consignment we generally make about the same as we would had we bought the car but without putting up a dollar...so it's a deal for the dealer, the buyers have more confidence in the seller, and the actual seller doesn't have to do much besides say yes/no when an offer comes in.

 

Dealers make a lot on some cars, lose some - or even a lot - on some cars, and make a little on most cars.

Margins are nowhere near what most people think.

And if it wasn’t for used cars, there would be no new car dealerships: The margins on used cars are generally higher than on new cars.

And a Toyota dealership is generally going to be more profitable than a Ferrari dealership.

Friend of mine had franchise Chevy/Cadillac dealership once and has had several cheap used car lots. He said the cheap used car lots made more $$$.

He said “I can make $2000 on a $7000 car and sell 5 of them, while I am trying to make $2000 on
a $30,000 BMW trade in.”

 

Range on consignment is 5-8% depending on price sold, desirability, dealer etc.

I suspect it’s about the same for Ferrari dealers to consign or sell used cars. New different animal.


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Ferrari dealers' gross margin percentage and dollars on a new car sold at msrp (as they virtually all are in the USA) is far higher than their margin points on a consigned car (they charge anywhere from 4-8% and then pay out advertising and commissions at min out of that).

But many Ferrari dealers sell many times more used/consigned cars than they get new car allocations.

So in aggregate dollar profit terms, they likely make more on used/consignment sales in total.

(fwiw, this topic and related topics come up regularly here and if you want more info, use the search function and you should see some lengthy threads on this topic)