Buying Cars

According to the National Automobile Dealers Association (NADA), there are approximately 20,000 new car dealerships in the United States. These automobile dealerships employed more than one million people and together generated $576 billion in sales in 2008. That means that car dealerships accounted for approximately 14.6 percent of all retail sales in the United States for the calendar year.

New car dealers generate income through not only new car sales, but also through used car sales, vehicle service, financing and the sale of add-on products and services. In the United States and Canada, a new car dealership is generally a franchise, that is they usually sell only one manufacturer's products. Used car dealerships, conversely, may carry vehicles representing a variety of different manufacturers. Because of consolidation in the industry, however, it is not uncommon today for one owner to operate a chain of new car dealerships in a given area, representing several different manufacturers.

Dealerships generally consist of a showroom and a car lot, where inventory is displayed for sale. Often a new car dealership will also include service bays where they may perform maintenance and repairs on vehicles. Dealerships may also include a parts department where replacement and aftermarket items may be purchased.

In the United States, federal law requires that all new cars display a window sticker that lists the manufacturer's suggested retail price (MSRP)....