auto news desk, Do you know the real cost of a car while buying it? No, nor do you get to know how much profit the showroom owner makes on the sale of the car. Today we will tell you how much profit the owner gets on selling a car. When you buy an item from a shop, its original price is very low but it is sold at a higher price so that the owner of the shop can also make a profit. It must be known to all that the actual cost of the car is low but when the car is bought on the road, its cost becomes high.
margin is less than 5 percent
According to a survey conducted by the Federation of Automobile Dealers Association, dealer margins in India are very low as compared to other countries. Dealers in India get less than 5 per cent margin on a vehicle. The dealer makes a profit of around 5% on the sale of a car and this margin is on the ex-showroom price. The dealers’ margin ranges from around 2.9 per cent to 7.49 per cent. It also depends on each company and the segment or region of the car. It has been told in the report that the highest margin is given to the dealers by MG Motors and Maruti Suzuki. About 5 percent or more percent commission is received from these companies. Other companies have lower margins.
taxes also differ
When you buy a car, you have to pay road tax, GST and other taxes. This tax also varies for different segments of the car. Cars below 1500 cc attract 28 per cent GST and the rest of the cars attract 17 per cent GST. Apart from this, road tax also has to be paid. In such a situation, a huge amount is given as tax in every purchase.