In this conversational video, Adam (joined by a second speaker) breaks down the fundamental differences between parts departments at passenger‑car dealerships and heavy‑truck dealerships. He explains that car‑dealership parts are largely B2C, tied to the service department’s repair flow, whereas truck‑dealership parts operate as a B2B wholesale operation serving fleets, municipalities, and other businesses that have their own technicians but no in‑house parts inventory. The discussion highlights stark contrasts in revenue composition (e.g., $400 k/month to service vs. $2 M/month to outside wholesale in a typical truck shop), staffing levels (a handful of counter staff in car shops versus a dedicated team of ten‑plus handling inbound calls in truck shops), and inventory size (much larger stock in truck locations to meet wholesale demand). Adam shares concrete examples, such as a Midwest truck dealer generating $2–4 M per month by buying overrun parts (e.g., alternators) from manufacturers like Bosch and reselling them to fleets. He notes that truck‑parts margins are highly competitive, making the business a “different animal” compared to car‑parts, but also points out the significant upside and opportunity in the truck‑parts market due to multiple vendors and high volume. The overall narrative underscores how the business model, sales channels, operational structure, and profitability differ dramatically between the two dealership types.
Chapters
So yeah, what— we'll kind of go around. I will— let me try to lay a foundation that we can build on here in answering this question. So the, the biggest difference between a car dealership and a heavy truck dealership is that one is B2C, so business to consumer. You're servicing a consumer. Truck dealerships are more B2B, so they're, they're business to business in a sense. And so now a parts department in a car dealership in a sense is B2B because you, you do sell stuff on the retail counter, but for the most part, the bulk of your business in parts is going to be through the service department. So you're B2— you know, you're kind of at the mercy of the service department. If the service department's running really well, they're doing good with their inspections, they're selling a lot of repair labor, you're going to sell a lot of parts in a sense, right? In a truck dealership, a lot of the business in parts comes from the outside, not the inside. So they're no— they're, they're numbers really, for the most part, will come from them selling to outside businesses because in the truck world, a lot of these fleets, so imagine a school district or Amazon, the, these businesses that have buses or trucks have their own technicians, but they don't have their own parts department. So they buy their parts from the dealership. And so you'll see a parts department in a truck dealership doing $400,000 a month to the service department and $2 million a month to the outside. Their outside sales, or you could call it wholesale, their wholesale sales are by far and away the bulk of their business. And so parts departments in a truck dealership have people out there selling. They have teams just like, you'll see a room of people just taking incoming calls for parts. Where in a car dealership, you would just have the counter people taking those calls or maybe the front counter. It would be like 10 people in a truck dealership versus, you know, 1 or 2 in a car dealership on the front counter. So it's more of a B2B business and the wholesale part of it is the bulk of what most truck dealerships are doing because municipalities, will have their own technicians. All sorts of fleets have their own techs and they're buying the parts from the dealership. And then you also have more competition in a sense, because there's other, you know, vendors out there that will sell parts to them. So it's all about the service. It's about delivering, you know, and inventory. So the inventories will be much higher in a truck dealership also, because they have to have it in order to sell it. How did I do, Adam?
That was awesome. I'm trying to think of ways to insert any sort of little gaps, but that was a really good overall arching.
Yeah, it's fascinating. Like, you know, we're fans of businesses and models and how things work. And that one has always been fascinating to me because if you've spent a lot of time in a car dealership, the parts department in a, Heavy truck dealership is, is a different, a completely different animal. And sometimes, like, when, when we were working with International, I would go around and visit dealerships. There would be dealerships that didn't even have a drive. Like, they were like a warehouse, and the, the parts would be functioning in cubicles with, without, totally disconnected from the dealership. It and they were doing huge numbers, like humongous numbers, like $4 million. Like, I, I'm trying to think of a— there's, there is a— there's one dealer that I know of in the Midwest that was doing like $2 million a month in parts wholesaling because he would buy a lot of the parts from the pallets, truckloads. From the, the manufacturers of the parts. So he'd go to Bosch and he'd say, hey, these, these alternators for Suburbans, you know, whatever you have left over after you fulfill Chevy's order, I'll buy those. And he would buy the, the overruns, I think they're called. And he was doing huge numbers. But that's the only time I've ever experienced on the car side somebody doing any sort of numbers like truck dealerships do in parts. It's a completely different animal. And the margins are a different thing too, because the margins are very competitive. It's a harder game.
I always look at it though, there's so much more of an upside though. I feel like not more of an upside. I just think there's a lot of opportunity in that truck parts realm too, because of all those different vendors.
