Dealerships Are Mostly A Scam, But You Already Knew That

New car buyers in America are often subjected to hours of dubious negotiation, shady sales tactics, and intentionally confusing paperwork. It probably won’t come as much of a surprise to you that this is a hundred-year-old practice used to extract the most money from the consumer as possible. Not only are dealerships capable of siphoning your money out of your pocket without you really knowing what you agreed to, but they’re better at making money from selling cars than the companies actually building the cars they sell. And on top of all of that, they’re protected from competition by law. It’s only like this here in the U.S. and it doesn’t have to be. 

This is, admittedly, quite a long video, but it’s worth sitting down to watch the whole thing, especially if you’re at all considering purchasing a new car at any point in the near future. I really love when Sam from Wendover Productions talks about cars and the auto industry. He’s a real car enthusiast with lots of knowledge and a solid research department at his disposal. Because he is based in Western Colorado, It does seem that the hypothetical Audi Q3 buyer used as a case study in this video is probably just Sam having gotten frustrated with the experience of trying to buy a car and made a video about it. Honestly, Sam, if you’re reading this, you can do so much better than a Q3.

This level of production and video essay journalism is refreshing to see on YouTube. Most of YouTube has collapsed into a house of brightly colored slop to trick kids into loving gambling, so properly educational content that is easily digestible by adults in 2026 is impressive. Admittedly the bar is low, but Wendover clears it by a wide margin. If you aren’t subscribed already, you should be.

Dealerships in the U.S. are not actually owned or operated by their respective automakers, but instead by fewer and fewer large national dealership networks. The top four dealership groups—Lithia Motors, AutoNation, Penske Automotive Group, and Group 1 Automotive—account for around 2.3 million new car sales and 1.05 million used car sales per year. Your local dealership was once owned by a local, but these days the owner of your local dealership may not even be in the country. We have click to buy and pay online access to just about every commodity on the planet, except cars. Outside of a few small EV-only companies like Tesla, Lucid, and Rivian, you simply can’t buy a car online, because it’s illegal.

Dealers don’t even need to make money on the sale of the car, because they’ll extract their earnings from you on back end. It’s not a good system. And because of the massive collective lobbying power of franchise dealerships, it’s really hard to challenge or change. With the successful non-dealership growth in the EV sector, the dealer model has been given a run for its money, but with massive legal protection, tax revenue, and the power of the billionaires who run them, it seems unlikely they’re going anywhere soon.

I have only ever bought one new car from a dealership. I test drove one car, agreed to buy it, didn’t haggle much, and had a reasonably pain-free experience with my salesperson (who knew far less about the car than I did), and it still somehow took several hours because of all the hoops I had to jump through. These hoops are designed to cost you money, and if you don’t know what you’re looking for, you’ll get completely and totally screwed. And if you’re in a remote area without ready access to a choice of nearby dealers, you’ll probably be on the hook for working with that dealership for the entirety of your ownership experience.