10-23-2014, 10:34 AM
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Banned
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Join Date: Dec 2007
Posts: 5,061
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Quote:
Originally Posted by sloride
Your post starts out with back in the day. I wouldn't be surprised if the IRS, and state agencies didn't want to start taxing the use or depreciation as income to the sales person. Some money grabbin pol may have determined that a brand new car that sells for say 20K is a 17K car as a demo unit, therefore taxing bodies just lost out on the sales tax. I had a fishing boat years back that I would occasionally charter out and my accountant said do it on a cash basis only or the IRS may come after you for any time that I used It personally at the same rate as I had chartered it for.
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Back in the day, a demonstrator was provided to the new car sales professional for two reasons:
1. The new car sales professional would have a current model/year vehicle to use to take prospects on test drives in hopes of selling either the demonstrator or a new car. It wasn't unusual for a competent new car sales professional to sell three demonstrators before noon.
2. Providing the new car sales professional with a demonstrator gave him/her a sense of ownership in the brand (Ford, GM, etc.). They were seen driving a new car of the same brand they were selling when out shopping at the grocery store as an example. If they were selling Fords and their PERSONAL car was a Chevrolet and one of their customers saw them at the grocery store driving a Chevrolet, their credibility was SHOT to HE**.
I personally experienced this recently. I took a test drive of a new Mercedes Benz. After the test drive, I had to ask the sales professional for their business card (The FIRST thing you do is give the suspect/prospect YOUR business card as you introduce yourself - the suspect/prospect should NEVER have to ASK for your business card). After the test drive I asked the sales professional which model Mercedes Benz he drove??? Answer: "I don't own a Mercedes but I hope to one day".
Back to your statement; if the sales professional quits/resigns or gets fired, the demonstrator is returned to the dealership. The use of the demonstrator is nothing more than a sales tool so the sales professional can sell more cars. It doesn't represent "income" to the sales professional because if they quit/resign or get fired, the demonstrator is returned to its rightful owner, the dealership. Of course, the sales professional may negotiate a great price on a purchase of the demonstrator if they wish. If they purchase the demonstrator the car then becomes THEIR personal ride and should not be used in business.
Last edited by HuskyMan; 10-23-2014 at 10:51 AM.
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