How Much Does a Car Salesman Make? (Earnings and Commission)

A car salesperson can be a great job choice for many people. With the correct strategy, they can earn a sizable income every month, including bonuses. How much does a car salesman make?

The average annual salary for a car salesman in the United States is $67,200. This equates to $5,600 a month.

Top performers can make $12,000 to $15,000 or more per month. If their performance remains consistently good for several years, the employer usually promotes them and gives other bonuses.

Read on to learn more about how much a car salesman makes and tips for earning more.

How Much Does a Car Salesman Make?

The average annual salary for a car salesman in the United States is $67,200 or $5,600 per month.

The average salesman makes $3,000 a month for selling about eight vehicles per month. Extra bonuses and incentives allow the average salesman to earn about $5,600 per month. [1]

A low-performing car salesman makes about $2,000 to $3,000 per month.

The top-performing salespeople make $12,000 to $15,000 plus per month for selling about 20 cars per month. The company also may promote the salesman to a higher position and give bonuses to top sellers. [2]

A car salesman makes money based mainly on their sales; so, the more cars the salesman sells, the more they earn. Some car companies provide low salaries, aside from the commission, while others offer commission earnings only.

how much does a car salesman make

How Does a Car Salesman Make Money?

Car salespeople make money mostly from commissions for their car sales. Some car companies may offer a salary, but this is relatively low that it is not considered a real income.

How much commission does a car salesman make? A car salesman usually earns 12% to 25% of the car sale. The company determines the sales commission based on its gross profit. Sometimes, there may be performance bonuses, promotions, and perks for top sellers.

So, how come some salesmen earn more than others? What’s the secret behind their success?

If you are a car salesman, you may want to know what factors play a crucial role in your sales. To help you resolve this predicament, here are some factors that you could consider.

How Much Does a Car Salesman Make per Car?

The average salesman makes $3,000 a month for selling about eight vehicles per month. So a car salesman makes about $375 per car. Extra bonuses and incentives allow the average salesman to earn up to $700 per car sold.

The salesman makes a percentage of the car’s sales price. Thus, luxury cars provide more income than used vehicles, as they are more expensive.

Factors Affecting How Much a Car Salesman Makes

1. Company’s Reputation

A company can sell any product provided that it has a sterling reputation. This principle applies to cars as well. Most people would buy from a reputable car company, no matter who the salesman is. Thus, sell only cars built by good brands.

2. Salesman’s Competence

Your professional competence is one crucial aspect that influences your sales. Do you know your product well to be able to endorse it honestly?

Can you fully explain to your prospective seller the car’s noise level, availability of spare parts, reliability, fuel consumption, emission level, type of engine, and other pertinent information?

Do you have enough IQ and EQ to deal with your customers? Your answers to the questions should be a resounding ‘yes.’ You need to know all this information to effectively sell your car.

Be presentable. You have to sell yourself first before you can sell any product.

This doesn’t mean you have to wear branded attires. Be neat by having those buttons correctly done, and those shoes are carefully polished. Who would want to buy merchandise from a person who cannot even take care of his appearance?

However, the most effective presentation of yourself is your sincerity and honesty. Always apply the “Golden Rule” when treating clients. Do to others what you want them to do to you.

3. Marketing Strategy

Your marketing strategy also influences your selling capabilities. You should create a sales pitch that you can deliver within minutes. We call this the ‘elevator pitch’ because you should deliver it within a short elevator ride within 20 to 30 seconds.

The pitch must be concise but provides the essential information you want the buyer to know.

You can start by saying who you are. Explain clearly what your product is and its unique features. What can the prospective buyer get out of it? Speak distinctly and pace your words properly – not too fast nor too slow.

When the client asks questions, that’s the time you can expound more when you reply. You have to practice your elevator pitch as often as you can, so it becomes second nature. But, you have to learn how to adjust your pitch with various types of customers.

Remember to give your intended customer your business card. Let the person know that you are available at any time.

4. Internet and High Technology Apps

Utilize the Internet and various updated technology to market your product too.

Your utilization of the Internet’s benefits and the explosion of high technology apps that go with it would affect your selling capabilities. Bring the car to your potential customer’s doorstep.

how much commission does a car salesman make

People are now shopping online for almost anything, from food to cars. Thus, take advantage of the Internet and these helpful apps. You could display the cars using 3D views of the car’s interior and exterior features.

You can also use virtual reality to allow the prospective buyer to have a ‘feel’ of the car’s features.

If you’re not familiar with these apps, ask the assistance of a technology expert. You can find these experts online too. You may spend a little bit as you establish your online business, but you can eventually recover any losses.

Don’t worry about being a novice in this area, as Online Search Engines have all the answers. Take advantage of the Internet to increase your sales.

5. Customer Service

If your customer service sucks, word-by-mouth will spread the word that it does, and you would be losing future customers. Many buyers read customers’ reviews first; hence, ensure that your car company offers excellent customer service.

If the company refuses to improve its customer services, you should make them realize that they stand to lose millions of dollars with lousy customer service. The cliché “the customer is always right” still applies in this day and time.

6. Post-Purchase Client Treatment

The same principle applies to your clients’ post-purchase treatment. Just because you have finally sold a car to your buyer, it means you can stop being the good guy. When you are sincere and honest, you would be treating your previous buyer the same attention you give to a new client.

Remember that your previous buyer could promote how good your service is to other people, like friends and family members. Word-by-mouth is still one of the bestselling strategies out there. So, do not neglect your previous buyers. Treat them like kings.

7. Personalized Service

Every customer wants to feel important. Let them know that it is a pleasure to assist them. Be mindful of their preferences and be considerate of their lifestyle. Know when to follow up your sales pitch or when to retreat from a possible sale.

Adjust your marketing method to each potential buyer, as no two individuals are exactly the same.

After you have concluded the sale, send a “thank you” card to your client and let him/her know that you are available during office hours for any inquiries.

How Much Does a Luxury Car Salesman Make?

A luxury car salesperson can make as much as $160,000 per year. This equates to $13,333 per month. This amount is for selling about 170 cars of Porsches and Mercedes per year.

If you could sell more than 170 cars a year, then you could earn more.

How Much Does a Used Car Salesman Make?

Used car salesmen’s earnings would depend on how many used cars they were able to sell. Since used cars are cheaper than new or luxury cars, salesmen have to sell more cars to make big money.

How much commission do car salesmen make? Typically, the same commission as that of luxury cars applies to the used cars. The commission percentage is usually about 12% to 25% of the car sale. The company determines the sales commission based on its gross profit. Sometimes, there may be other bonuses and perks for top sellers.

Sometimes, the company may offer a uniform amount for any vehicle the salesman can sell.

As a used car salesman, you can make as much as $40,000 to $80,000 by selling 20 to 30 used cars. Your earnings would depend on how many used cars you were able to sell.

How much does a car salesman make? In the U.S, a car salesman makes an average of $67,200 annually.

The salesmen who are considered top performers make $12,000 to $15,000 plus per month. Usually, a car salesman’s commission is around 25% of the car’s sales.

Tips on How a Car Salesman Can Make More Money

1. Pay Attention to Your Customers’ Preferences

Avoid insisting on a car that your customer obviously does not want. Unless you honestly think the vehicle your customer has chosen is not suitable or has significant defects.

2. Sell More Cars

Once you have sold a car to a client, don’t stop there; sell more cars to your client by inviting your client’s family and friends to find out how good the car is.

3. Choose Luxury Cars

Luxury cars are more expensive, so that you will earn more from commissions. You can make double the amount with the number of sold luxury cars than selling used cars.

how much do car salesmen make

4. Recognize the Importance of Sales Factors

Go over the list of factors affecting car sales presented above and prepare your marketing strategy to make more money. You can use all these factors to improve your sales.

5. Adopt the Pointers in Being a Good Car Salesman

Adopt all the tips below in becoming a good car salesman. Knowing how to sell yourself first would surely increase your car sales too.

How to Be a Good Car Salesman?

1. Build Good Rapport

Before people can buy from you, they should trust you and be comfortable around you. Try to build rapport with your customer by showing them that you genuinely care for them.

2. Remember Your Clients’ Names

There is nothing sweeter than hearing one’s name from another person. It is a mortal sin for a salesman to forget the client’s name. Always remember your clients’ names. This action would demonstrate how much you value them.

3. Be Sincere and Honest

A salesperson who has sincerity and honesty would surely sell more than someone insincere and dishonest. Buyers would most probably be receptive to your actions; thus, never lie to your clients. They would eventually discover your lies and would shut you out from further communication.

4. Be a Good Listener

Most people would want to talk about themselves and their ideas; so, take time to listen to what they have to say. Listen as much as you talk. By listening, you would learn what your customer truly wants.

5. Ask Sensible Questions

You could ask the right questions while talking to your potential client. By asking sensible questions, you could learn more about your client’s preferences and provide the car that the person wants.

6. Avoid Being Pushy

Know when to stop pushing. If you notice that your prospective client is getting irked, you should stop. Irritating a client will not get you anywhere. You can gracefully exit and leave your business card with the client with your phone number on it.

Conclusion – How Much Does a Car Salesman Make?

In the United States, the average annual salary for a car salesman is $67,200. This equates to $5,600 per month.

Top car sellers make as much as $12,000 to $15,000 plus per month. The company also rewards them with bonuses, incentives, and promotions if their performance remains excellent throughout the years.

How much commission does a car salesman make? A car salesman usually earns 12% to 25% of the car sale. The company determines the sales commission based on its gross profit. Sometimes, there may be performance bonuses, promotions, and perks for top sellers.

How much does a car salesman make per car? If you are a car salesman, you can earn as much as you want. You have to make use of correct marketing strategies.

Selling expensive luxury cars would make more money than selling used cars. Identify and choose what car you want to sell based on your buyers’ demographics and give it all you can. With sincerity, honesty, hard work, and the correct strategy, you can succeed.