How much does it cost to start a car dealership?

Question

Zippia Team · Accepted Answer

The average cost of starting a car dealership is from $150,000 to $600,000. The cost of opening a car dealership varies greatly, depending on whether you decide to open a new car franchise or a used car dealership. Both of them have their pros and cons, and they vary greatly in associated costs.

Generally, new car franchises cost more to open than used car dealerships. Ford starts at $30,000, but that does not include inventory or rental space, which puts you around $170,000. Hyundai and Toyota cost about $500,000. While new car franchises are more costly to begin, they are the only option if you want to sell new cars, as it is illegal to sell new cars outside of a franchise.

A smaller, used car dealership often has lower startup costs. You can expect to pay anywhere from $5,000 to $50,000 for the space for your dealership. Then you need to purchase inventory ($50.000-$100,000), supplies such as computers, printers, and phones ($4,000), and you need to hire employees ($10,000).