Do you know how much does a car salesman make? Well, people are getting interested in this industry. They are trying to build their career in this job category and make living out of it. Yeah, it’s not what it looks like but how much do they earn? In this article, we will solve the puzzle for you. Let’s get started.
The COVID-19 pandemic indeed brought a considerable drop in sales of new cars worldwide. This affected not only the companies but also the car salesman. Still, the job as a car salesperson is lucrative.
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However, it is difficult to estimate the average salary of a car salesman. A lot depends on the car brand the person is affiliated with. As you can imagine – it is one thing to sell FIAT cars and quite another thing to sell Maserati or Ferrari cars!
So, to clear the confusion, we’ve discussed all the aspects to find out how much does a car salesman make.
What are the Responsibilities of a Car Salesman?
The main mission of the car salesperson is to welcome and advise customers in their vehicle purchase process. The person works for a dealership or within a branch.
The automotive salesperson is the representative of the brand for which he works. As a salesman, you must know the brand’s values and characteristics you work for. You, therefore, have a vital role as ambassador and image with customers.
Here are some responsibilities a salesperson need to do:
- Create a clientele made up of individuals or companies and build loyalty through contact.
- Creates files for them to get to know them well.
- Offer clients the products best suited to their desires and their situation.
- Understand the customers’ expectations, advise them and direct them to a type of vehicle, a brand, a model, etc.
- Find the car solution that will best match each profile, new or used.
- Develop a speech to convince possible future buyers – chiseled arguments, persuasive sentences; everything must have to push the customer to buy!
- Market additional offers in addition to the sale of the vehicle – financing plan, insurance services, etc.
- Ensure customer follow-up to maintain the loyalty of regulars.
- Follow the news of the automotive sector to know all the news.
Skills and Competencies of a Car Salesman
Common skills and competencies a sales Clarke should possess are as follows:
- Must imperatively be a good trader and a good salesman.
- Be able to convince but also to advise the customer according to his needs.
- Listen to the customer to offer him the right product.
- Be friendly and warm, with good presentation skills.
- Know the products sell inside out and master the financial solutions provided.
So now the questions come, is it really worth it to become a car salesman. And how much you can earn from this career.
Let’s find out.
How Much Does a Car Salesman Make?
Car salespeople are specialists in the sale of cars and are a part of the customer. They will end up incentivizing a person to take a new car home. But you may wonder what a typical car salesman commission is.
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So here we explain how an average car salesman’s commission works without going searching more!
In most cases, car dealers work in three industries:
- New Car Dealerships
- Used or
- Agency Cars
The first one pays the most and with the best benefits. Car salesmen usually have a base or minimum salary.
However, they get commissions for the sale of vehicles; likewise, you must sell several cars from time to time.
Let’s see, how are car salespeople paid.
New Car Sales Commission
Every seller charges a typical sales commission percentage per month, but the commissions can vary and range from 5% to 1%. Of course, this applies to a general manager and employees too.
In the case of a new auto sales commission structure, the commissions are low. This is because the car has a marked price, and the agency earns 3% per sale. Of that 3%, the salesman can get up to 5% or something more, depending on the dealership.
Average Commission For Used Car Salesman
In this case, used car salespeople have a lower base salary than that of new car sales. Also, your commission isn’t that juicy, as car prices are lower.
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Commission earnings are typically 3% or 5%. However, there are exceptions, depending on the model, the seller, and the buyer. Even the profit margin can be higher than that of the sale of new cars since these are not marked with a sale price.
What is the Salary and Commission of a Car Salesman?
First of all, you should know that the salary will depend on several factors:
Firstly, it depends on your country (since the currency is different in each region).
The second is in the company where you work. There are multimillion-dollar companies that have already been very successful and can afford expensive salaries.
On the contrary, small car companies and salespersons have a fairly low salary.
Finally, the third factor lies in the position that the person has.
Salary Depending on the Country You Work In
- Argentina: Approximately 258,000 Argentine Pesos Per Month.
- Chile: 433,362 Chilean Pesos Per Month Approximately.
- Colombia: 1,075,553.00 Colombian Pesos Monthly.
- Canada: Between $ 20- $ 40 Per Hour, Depending on the Company.
- United States / USA: In Miami, Florida, $ 20 Per Hour.
- Spain: In Madrid, Approximately 913 Euros Per Month.
- Mexico: 92.31 Mexican Pesos Per Hour Approximately.
- Peru: Approximately 1,000 Soles Per Month.
Note that the commissions, regardless of the country in which you are, should be between 1% and 5%. This is established in the constitutional laws of each country. Therefore, although it is possible, you can earn a little more through an agreement with the company.
Salary Depending on the Company You Work For
- Chevrolet: Between $ 24 and $ 44 Per Hour.
- Ford: $ 6,665 Per Month.
- Hyundai: $ 190 Per Day, Approximately.
- Kia: Between $ 20 and $ 40 an Hour.
- Mazda: $ 6,500 Monthly Salary Without Commissions.
- Mercedes Benz: $ 200 Per Day.
- Nissan: $ 25 Per Hour.
- Renault: $ 6,235.76 Per Month.
- Volkswagen: $ 36 to $ 40 Per Hour, and About $ 80,000 Annually.
- Ferrari: $ 9,460 Monthly + Bonuses.
N.B: Prices are subject to changes.
Car Sales Pay Structure: How to Calculate the Pay?
If you want to know how much does a car salesman make, you need to understand the salary structure first. The salary of a car salesman varies primarily according to the contract and classification.
If it is a simple apprenticeship salary, the monthly fixed salary will be lower than 800 dollars for 40 hours of work per week.
Apprentices usually work alongside an expert sales clerk and therefore fail to accrue any extras. That’s why they don’t have the possibility of earning overtime hours.
If it is not an apprenticeship contract, the 40 hours per week can be salaried with:
(A fixed + expense reimbursement + commissions on sales)
Yes, but how much?
It is not possible to generalize. But for example:
$ 1,000 + $ 350 reimbursement of expenses + overtime (to attend stands at fairs and shopping centers, business dinner, or evening meetings to present a new car)
But if you want to know how much does a luxury car salesman make, it would be on an average of $64,178. Are you curious about how much commission does a car salesman make in South Africa? Well, on average they are earning about R198000 per year.
Can I Lose Money from My Commissions?
The answer is yes.
If the minimum monthly sales are not reached, instead of paying 1% for each unit, they pay it at 0.8%.
Another situation that can subtract you from your final commission is the gifts – for example, Courtesy rugs, maintenance services, extra accessories.
If there is no prior agreement with the sales manager, those courtesies will be deducted from the seller’s commission. Therefore, we suggest not to offer unless you have an initial contract with your manager.
FAQ: How Much Does a Car Salesman Make
Yes, we understand it’s important to know how much does a car salesman makes before trying to build your own career in this job sector. Interested people are trying to get proper answers on different platforms. We have collected all those queries and answered them all at once in the below section. Let’s check them out first.
Do Car Salesmen Make Good Money?
It depends. If you work hard and are passionate about the job, and work for a high-end brand, it can provide good money.
Do Car Salesmen Have a Base Salary?
Mostly yes. Most of the companies provide the car salesperson with a base salary. However, the base pay is almost like a minimum wage. Most of the money comes from car salesman commission per car.
What is the Average Commission for a Car Salesman?
The average car salesman commission rate is around 25% on profit a car makes. It can vary depending on the company policy.
Can a Car Salesman Make Six Figures?
Why Not? While this is a very challenging task, one can definitely earn more than six figures with all the stars aligned.
Why Do Car Salesmen Have a Bad Reputation?
The bad reputations are not because of their personalities but because of the type of the jobs. Since they earn most of their earnings by the commission, they can be very persuasive, sometimes a little pushy.
How Many Hours a Week Do Car Salesmen Work?
Like any other job, a car salesman usually works 40 hours a week. But they also have the opportunities to work overtime, in fairs, malls, or for test drives if necessary.
Is Car Sales a Good Career?
If you can handle stress, communicate well, and have excellent knowledge about cars, this can be a great career for you.
How Much Does a Car Salesman Make at Mercedes-Benz?
Average Mercedes-Benz Sales Representative yearly pay in the United States is approximately $72,828, which is 16% above the national average.
How Much Does a Car Salesman Make Per Hour?
It depends, but on an average a car salesman earns $20 per hour. And if you want to know how much does a car salesman make a month, it would be $3,492.
A car salesman’s job may seem like a fairytale – the expensive cars, million-dollar deals, and what not! People think working as a car salesman gets a lot of money, but all glitters are not gold.
While some of these are true, the stress and completion are valid too. So, how much a car salesman makes depends on skill, company, and luck.