7:37 am, October 14, 2022
Car dealer bosses have given themselves pay rises of more than £134,000 this year as company profits soar.
Increased pay packets, enhanced with bonuses after the industry made record profits in 2021, has seen the average car dealer boss take home £407k.
According to accountancy firm BDO, pay for the leaders of car dealerships has increased from an average of £272k in 2021, and £273k in 2020.
The basic pay of management at car dealerships has grown 17 per cent this year, according to the Motor Salary Survey 2022.
But, thanks to those whopping bonuses, pay packets of the car dealer leaders has soared some 70 per cent.
Pay packets for car dealership finance directors have also increased by almost £100,000 to £252k in 2022, compared to £153k last year.
Meanwhile car dealer principals took home an average of £148k this year, compared to £116k last year.
The average base salary across car dealer businesses was £44,475 – up from £42,292 last year. A further £18,055 was received, on average, in commissions and benefits.
That meant pay rose 16 per cent when all positions in dealerships were considered.
BDO said: ‘This is in contrast to what we have seen in previous years.
‘As the market recovered post-Covid, with demand returning closer to normal levels, sales departments were given the opportunity to earn increased commissions
‘Unsurprisingly, given the responsibility and complexity of their roles, the remuneration packages for the key executives continue to be the highest of all the positions.’
The management pay rises come after many in the industry froze their pay and bonuses throughout the pandemic.
How much do people earn in car dealerships?
- Sales: £64k (2022) – £56k (2021) – +14%
- Parts: £31k (2022) – £29.5k (2021) – +5%
- Service: £35.7k (2022) – £34.7k (2021) – +3%
- Admin: £34k (2022) – £32.7k (2021) – +4%
Source: BDO Motor Salary Survey 2022
BDO added: ‘There have been strong increases in the vehicle sales departments reflecting the increasing used values in the market and increase in customer spending giving those salespeople greater opportunity to earn more commission.
‘Additionally, the vehicle sales departments would have been the more impacted by the pandemic with showrooms closed.’
On average, car dealer employees worked 42 hours a week – up an hour on last year.
The annual Motor Salary Survey by BDO uses data from groups and companies that together operate 600 dealership sites across the UK.
These dealers ranged from single site operators to large publicly listed dealership groups.
Steve Le Bas, head of motor retail for BDO, said: ‘The percentage of remuneration related to incentives and commission stands in contrast to what we have seen in previous years.
‘As demand returned to near pre-pandemic levels in the second half of 2021 and into early 2022, so did the opportunity to earn increased commissions.
‘Management bonuses, that would have disappeared during the early phase of the pandemic, have returned, and reflect the record profitability across the sector.
‘Our findings also showed that appetite for growth and expansion is strong, with more than one third of dealer groups having acquired, or considering acquiring, another business in the near future.’
The report looks into 29 positions across the dealerships and a full version can be seen on the BDO website.
