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  • benenglish

    Just Another Boomer
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    7   0   0
    Nov 22, 2011
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    Backwards. Service is well over 50% of the income in a dealership.
    I suppose it depends on the dealer but that's what I've heard.

    I remember when the Mitsubishi Diamante came out. The first one to arrive at the dealership on the SW Fwy was taken home by the VP for the service department. After a day or two, he returned it with a triumphant conclusion: "Best car Mitsubishi has ever made! It's a piece of crap but it has more electrical accessories on it than I can count. They'll all fail and we'll make money hand over fist fixing these things for years!"

    At that dealership, at least, the service department was a big income source.
     

    easy rider

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    0   0   0
    Jun 10, 2015
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    Backwards. Service is well over 50% of the income in a dealership.
    Services isn't just working on your car. Services also includes warranties, insurance and options. Servicing a vehicle is not the same as repairing. I'm not saying they don't make money off repairs, but that's not their primary income.
     

    toddnjoyce

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    4   0   0
    Sep 27, 2017
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    Boerne
    Services isn't just working on your car. Services also includes warranties, insurance and options. Servicing a vehicle is not the same as repairing. I'm not saying they don't make money off repairs, but that's not their primary income.

    Correct. A branded dealer’s largest profit centers are finance and service. Service includes all the above plus what is traditionally considered service.

    Non-branded profit centers are finance. Some of the buy here/pay here ops will have ‘creative’ financing that usually results in repo and resell. I’ve seen one particular dealer in this segment resell the same vehicle 4x in a year. Miss one payment and it’s a 21% of the balance fee payable in 5 days in addition to the missed payment.

    IIRC, warranty work is either back charged or reimbursed, depending on manufacturer policy.
     
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