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How Much Money Does a Car Sales Person Make?

by Rick Suttle

With all the new models General Motors, Ford, Toyota and other automobile manufacturers introduce each year, car salespersons stay busy showing cars to people, demonstrating key features and letting avid consumers test-drive the vehicles. Car salespersons also negotiate with buyers on prices, process orders and help customers get affordable financing. If you want to be a car salesperson, you'll need to be self-motivated and, for the most part, be willing to get paid on a 100-percent commission basis. In return, expect to earn above-average income compared to most occupations.

Income and Qualifications

Some car salespersons earn monthly base salaries, plus specific dollar amounts for each car they sell. More receive salaries for a short period, such as three months, and then go on 100-percent commission plans. Those on commission commonly earn 20 percent of the gross profits of cars they sell, according to Crain's Detroit Business. Gross profit is the difference between the retail price and what a dealer pays for a car. All told, car salespersons earned average annual incomes of $50,000 as of 2103, according to the job website Indeed. To work in this field, you usually need a high school degree and a couple of years' experience in retail sales. Many employers will hire college graduates without experience, however. Other important qualifications include selling skills, persistence, confidence and communication and customer service skills.

Income by Region

Average incomes for car salespersons varied among U.S. regions in 2013. In the Midwest, they earned the lowest incomes of $42,000 in South Dakota and the highest of $55,000 in Illinois, according to Indeed. Those in the Northeast made $44,000 and $59,000 per year, respectively, in Pennsylvania and New York, which were the lowest and highest incomes in that region. If you worked in the West, you'd earn the lowest income of $36,000 in Hawaii or the highest of $55,000 in California. Expect to earn $42,000 or $59,000, respectively, in Louisiana or Mississippi, which represented the lowest and highest incomes in the South.

Contributing Factors

Car salespersons often earn more as they gain experience. They may receive referrals from satisfied customers or gain repeat business once they've been in the business awhile. In this field, you're also more likely to earn more selling new than used cars. New-car salespersons earned average incomes of $54,000 in 2013, according to Indeed, while those who sold used cars made $52,000 annually. You may also earn more selling luxury automobiles such as Mercedes, Porches and BMWs, because profit margins are likely higher for these brands.

Job Outlook

According to the BLS, jobs for retail sales workers, including car salespersons, should increase 17 percent in the next decade, which is statistically about average compared to the 14 percent growth rate predicted for all occupations. You'll likely find more job opportunities in this field when the economy improves. It would also behoove you to work in highly populated areas, which can draw in more potential customers.

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