Car dealers under watchdog investigation
If cars are sold at the advertised price, dealers can have profit margins of up to 45 percent.
But cars are always sold at less than the advertised price, and dealers usually pay more for your old car than it’s worth. You always get a good deal.
So says Rúni Djurhuus, CEO of the Wenzel car dealership.
“Our profit margin per car rarely exceeds DKK 12,000,” he says.
He is currently abroad and thus not available for further comment.
Potentially misleading advertising
This is something the consumer watchdog is currently looking into.
“It is generally okay to negotiate a price, but if all cars are sold at a lower price than the advertised price, this amounts to misleading advertising, and that’s illegal,” says Rannvá Sólheim, of the consumer watchdog.
“And, if the final price of a new car is determined by what the dealer offers for the customer’s old car, things become even more complicated due to a lack of transparency.”
KvF contacted another major car dealer, but they declined to comment on profit margins.
Faroese car dealerships reported total net profits of DKK 43.2 million in 2021, according to Figures from the Competition Commission.
More Faroese News in English.