Auto Dealers Forced to Discount New Cars-Here’s Why

Those in the market for a new car may want to consider purchasing one now. Why? Because dealerships have recently been forced to discount new vehicles due to low sales.

The article Economic Hardship Forces Car Dealers to Massively Discount New Cars stated, “With 2016 auto sales down as much as 42% from 2015, many…new cars sit unsold in dealer lots. And while the car dealerships would love it if everyone would buy a new car at full retail price, the fact remains that they’ve been forced by the economy to quietly advertise massively discounted deals online.”

Judging from this statistic, new-car sales have plummeted. This is good news for individuals needing to purchase a vehicle, but bad news for auto dealers.   

Can Discounting Vehicles Affect Dealership Valuation?

Dealership valuation refers to what an auto dealership is worth. This is something that can be determined by an automotive expert (also known as an auto expert witness). It’s important for auto dealers to have their businesses valued for tax purposes, as well as for the purpose of business planning.  

Heavily discounting a lot of vehicles can affect dealership valuation. Obviously, this can have a negative impact on business owners who rely on healthy new-car sales. Auto dealership owners who find themselves wondering what their businesses are worth and how to increase the value of their dealerships can get help from an automotive expert.   

How an Automotive Expert Can Help Increase Dealership Valuation

When dealership valuation is depressed, an auto dealer should consider contacting an automotive expert. An automotive expert not only assesses the value of an auto dealership; he or she also helps business owners strategize about ways to increase dealership valuation. Additionally, an automotive expert is often experienced in dealership succession planning, dealership tax planning, and legal issues pertaining to auto dealerships (for example, partnership dissolution, ownership disputes, and class action settlement valuation).  

Are you interested in learning more about the services of a qualified automotive expert? If so, contact automotive expert Bryan Parker.

Auto dealers, have you experienced lowered sales lately? If so, have the services of an automotive expert helped you?