How Much Do Car Salesmen Make?

How Much Do Car Salesmen Make

You may not know this, but the average salary of a car salesman is more than $62,000 per year! That’s near twice the national minimum wage in the United States!

However, this depends on your work experience, location, and any additional skills you have that may set you apart from other salespeople (such as technical or mechanical knowledge).

The good news is that starting salaries are reasonably good, even in entry-level positions, so if you’re ready to put in the time to learn about cars and how to sell them effectively, this could be an attractive choice of career.

Let’s take a look to know just how much car salesmen make.

What Does A Car Salesman Do (Job Outlook)

Thousands of salespeople are primarily commissioned-based workers who earn income in one of two ways: through a salary, paid by their employer and based on hours worked; or through commission, which means they make a percentage of each car sale.

In most cases, car salespeople receive a mix of both types of income. A car salesperson performs the following duties:

  • Brings in new and used vehicle prospects by calling or visiting businesses, such as car dealerships;
  • Introduces customers to specific models and accessories;
  • Schedules test drives;
  • Answers questions about warranty coverage, financing options, and trade-in value. Car salespeople have often commissioned workers who earn income based on commission.

The Average Salary of a Car Salesperson

On average, car salespeople make about $33,000 a year. That’s just above $15 an hour if they have an hourly wage, or about $22 per sale if they get paid on a commission structure.

However, some factors affect the average car salesman’s commission salary and increase or decrease their annual income.

Fixed Salary

Salaried salespeople who have a fixed salary make about $33,000 annually. That’s about $15 an hour if they are paid hourly, or approximately $22 per sale if they get paid on commission.

Commission-Based Income

A different car salesperson may make more or less than that depending on whether he is paid a set amount per month as a base salary and also receives a commission for each sale he makes. This form of payment often comes with incentives for selling certain cars.

For example, a luxury brand salesperson might get $5,000 in commissions if he sells two BMWs within his first two months at work; that’s $2,500 extra pay just for selling one type of car.

Incentive-based plans

Car salespeople can earn more money by participating in an incentive-based plan that rewards people for hitting certain targets. A company might offer to pay a commission of $500 for every two cars sold.

If an employee makes 15 sales in three months, he’ll have earned $2,500 on top of his base salary—that’s a total income of $37,500. The profit margin or profit per vehicle differs across states.

Frequently Asked Questions (FAQs)

What’s the average commission rate of car salespersons in Ontario?

The average commission rate for salespeople in Ontario is 3.4%. Most vehicle sales dealerships pay a higher commission to mid-level car salespeople. In addition, top successful salespeople can earn a bonus of up to 100% of their base salary and commissions, resulting in a total compensation package of almost $75,000 per year.

What’s the requirement to be a car salesman?

The only prerequisite to becoming a car salesman is that you must be 18 years old. Since you’ll need to become licensed, most states will require some level of driver’s education. However, many dealerships will provide entry-level car salesmen paid training for new hires, so you don’t have to spend money on classes upfront. Additionally, dealerships are typically reimbursed by insurance companies for any approved salesperson training they offer as part of their employee benefits package.

How Much Do Car Salesmen Make?

You’ve probably heard someone asking a friend how much do car salesmen make on average. Well, they earn an average of $37,000 yearly, while more experienced vehicle salesmen make more than that figure.

Is being a car salesperson worth it?

Many people don’t consider becoming a car salesman because they think it’ll be boring or difficult. While these are all legitimate concerns, it’s important to realize that any job has its ups and downs. As long as you’re honest with yourself about your career path before you start your first day, you should enjoy your time in sales. A salesperson on salary could sometimes be offered good benefits packages for salespeople, so taking a position in retail is often worthwhile financially.

Conclusion

Most people want to know how much car salesmen make since it’s perceived to be a tough job, but the fact is anyone with zeal and a good sales background can do it. So if you love cars and have a talent for influencing others, consider becoming a car salesman.

Car salespeople are typically paid a commission rather than a salary, which means they earn more when they sell more cars. The income streams for a car salesman were $27,500 as of May 2017.

New car salespeople can expect to earn roughly $20,000 their first year on the job and more than $40,000 after two or three years in a dealership. A top-earning salesman may make as much as $70,000 annually plus bonuses and incentives.

So, we believe with this guide we’ve provided an answer to the question, how much do car salesmen make.

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