Two prominent auto retailers in the U.S. Northeast are raising concerns over the growing influence of car brokers, warning that the practice is steadily eating into dealer profits and distorting market dynamics.
Paul Sansone Jr., who owns five dealerships in central New Jersey, and Jake Lebowitz, whose group operates 16 locations across New Jersey and Pennsylvania, may be competitors in business, but on this issue, they’re firmly aligned. Both argue that unchecked brokering is putting traditional dealership models under serious strain.
“It’s decimating dealer profitability in our region,” Sansone said, pointing to a trend that has accelerated in recent years.
The Economics Behind Broker-Driven Deals
At the heart of the issue is a pricing imbalance created by broker-led transactions. Dealers often end up selling vehicles at a loss to meet manufacturer sales targets tied to incentives.
Sansone explained that while a dealer might lose between $3,000 and $7,000 on a single brokered deal, those losses can sometimes be offset by hitting volume-based bonuses. For instance, selling a handful of vehicles at a loss may still make financial sense if it helps unlock incentives across a larger batch of sales.
However, this strategy is far from sustainable. According to Sansone, brokers may influence as much as 80 percent of certain dealers’ sales outside their primary market areas, significantly shifting how and where vehicles are sold.
Licensing Loopholes and Uneven Playing Field
Lebowitz highlighted another major concern: the disparity in regulatory requirements. Becoming a licensed dealer in states like New Jersey requires substantial investment, compliance, and long-term commitment to the community.
In contrast, many brokers operate with minimal overhead and, in some cases, without proper licensing, while still advertising themselves in ways that resemble authorized dealers.
“Dealers invest millions locally, support communities, and follow strict rules. Brokers can operate with far less accountability,” Lebowitz said.
This imbalance, he argues, creates an uneven playing field where traditional dealers bear the burden of regulation while brokers capitalize on flexibility.
Misleading Pricing and Consumer Confusion
Another friction point is advertising. Dealers claim brokers often promote deals that are unrealistic or unsustainable, leading to confusion among buyers.
Lebowitz shared instances where customers approached his dealerships with broker offers that would result in losses of up to $10,000 per vehicle if matched.
Such pricing, he says, distorts consumer expectations and makes it harder for legitimate dealers to compete transparently.
Calls for Stronger Enforcement
Rather than eliminating brokering entirely, both Sansone and Lebowitz are advocating for stricter enforcement of existing regulations. They believe that better oversight from both manufacturers and regulatory bodies could significantly reduce unfair practices.
“Let’s enforce the policies that are already in place,” Sansone emphasized.
Dealer groups in the region have already begun engaging with authorities to push for clearer guidelines and accountability.
A Divided Industry Perspective
Despite the criticism, not everyone sees brokering as a problem. Supporters argue that brokers provide value by offering convenience, upfront pricing, and access to hard-to-find vehicles beyond a customer’s local market.
Some industry voices also point out that brokering is legal in certain states, including New York, where updated guidelines were introduced recently to regulate the practice more clearly.
The Bigger Picture
What this really comes down to is not just competition, but the terms of that competition. Dealers like Sansone and Lebowitz aren’t pushing back against choice, they’re pushing back against what they see as inconsistent rules.
If left unchecked, they warn, car brokering could reshape the retail auto landscape in ways that undermine traditional dealerships, not through better service, but through regulatory gaps.
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