Diminished Dealership Deals: Honda Canada will cut dealer margins by up to 44 percent

Toronto, Ontario — According to a recent report made by Automotive News Canada, Honda Canada will be cutting dealer profit margins on each car sold by up to 44 percent.

This decision is specifically highlighted as a strategy from the automaker to help it finance the transition toward electric vehicles.

Honda Canada has not shared comments on the decision, but several dealers have since shared their frustration and incomprehension, qualifying the situation as “never-before-seen” and a “blatant money grab.”

Many dealers have also reported the decision as an unfair move from Honda, as if “penalizing its dealer network for its financial situation.”

A 44 percent cut to dealer margins would translate to a loss of $900 on a $45,000 vehicle when recalculating decreased margin percentages.

For the consumer, fears reportedly exist of the possibility of dealers transferring these losses to buyers by way of additional administration fees on the purchase of cars, a practice that, up until now, has not been tolerated by Honda.

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