The Difference Between Retail & Wholesale Cars

The automotive industry makes wide use of two classifications for cars: retail and wholesale. Each group includes a specific pricing structure for the vehicles. Automotive dealers focus on price points for vehicles in order to sell vehicles before the cars depreciate on the lot.

Facts

In general, retail cars represent a vehicle purchased by consumers. These individuals pay a price listed by the dealerships, though buyers typically negotiate their price. Dealerships pay wholesale prices when buying used vehicles from auctions.

Features

Buyers typically rely on a pricing guide for used vehicles to determine current market value. Dealers also have a buying guide for wholesale cars. This ensures the dealer does not pay too much for the vehicle, and thus reduce his profit when he prices the vehicle according to the consumer guide.

Considerations

Though retail cars can be either new or used, wholesale cars are typically used vehicles sold at auction or from a car broker. Individuals are usually unable to buy from a car auction unless they employ a wholesale buyer, who can buy the unit from the auction for the consumer.

References

• Edmunds: What Is the Kelley Blue Book Price?
• Used Car Book Prices: Edmunds Car Prices
• Edmund: Using a Car Broker to Buy Your Next Vehicle