Car dealerships in the United States

In the United States, a car dealership is a business that sells cars. Dealerships are often either a franchised dealership that is affiliated with a specific manufacturer and primarily sells new cars, or an unaffiliated dealership that only sells used cars from various manufacturers. Most dealerships also provide maintenance and repair services as well as trade-in, leasing, and financing options for customers.

Some new car dealerships may carry multiple brands from the same manufacturer. In some locales, dealerships have been consolidated and a corporation may control a chain of dealerships representing several different manufacturers.

All 50 states have laws that prohibit auto manufacturers from competing with their franchised dealers by selling directly to consumers, with some states additionally prohibiting all direct auto sales. However, following efforts by Tesla in the 2010s, some states permit direct-to-consumer sales by manufacturers without franchise agreements. Economists have characterized these regulations as a form of rent-seeking that extracts rents from manufacturers of cars, increases costs for consumers, and limits entry of new car dealerships while raising profits for incumbent car dealers. Research shows that as a result of these laws, retail prices for cars are higher than they otherwise would be.