South Dakota Auto Dealer License Guide

Auto dealership licenses are handled by the South Dakota Division of Motor Vehicles (DMV). A licensee is permitted to sell, store and display vehicles or boats on a supplemental lot in addition to their principal place of business.

Determine Which Type of License You Need:

  • Vehicle Dealer: Can sell new and used vehicles
  • Used Vehicle Dealer: Can sell used vehicles only

Note: Information about other classifications (Mobile Home Dealer, Motorcycle Dealer, Snowmobile Dealer) can be found in the DMV licensing requirements guide.

How to get your Auto Dealer License

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Obtain a Permanent Business Location

Your business location must meet the following requirements:

  • An enclosed structure
  • Easily accessible and open to the public within reasonable business hours that are posted
  • An improved area adjoining the building, large enough to display at least five vehicles
  • Contain all books, records, files, and related materials necessary to conduct business
  • Not in a hotel, motel or apartment house, unless the entire ground floor is devoted solely to the business
  • Maintain a telephone and listed telephone number
  • New vehicle dealers must have a repair shop with space to repair, service, maintain and recondition at least one vehicle and be equipped with tools, parts and accessories within the place of business or within the county
  • The location of your principal place of business must be in accordance with all applicable local, state, and federal land use ordinances, building codes, and zoning regulations

Note: A licensee is permitted to sell, store and display vehicles or boats on a supplemental lot separate from their principal place of business.

Before applying for your license, a dealership inspection must be completed to verify that your dealership location is in accordance with South Dakota law.

Note: Once you are licensed, a dealer investigation may still be performed once per calendar year to determine if any violations exist.


Obtain Proof of Liability Insurance

Vehicle dealers, used vehicle dealers and motorcycle dealers must have a public liability insurance policy with a minimum coverage of $300,000. (Trailer, mobile home, snowmobile and boat dealers are not required to obtain this insurance.)

Auto Dealer Insurance

There are several types of insurance coverages that are recommended for auto dealers, but the recommended coverage will vary based on your business and personal needs.


Obtain Your Auto Dealer Bond

The cost of a South Dakota auto dealer bond is a small percentage of the total bond amount. The bond cost varies depending on your financial strength, e.g. personal credit. You can also take a look at our most frequently asked surety bond questions.

  • Fill out our online application form to obtain a free bond quote for your auto dealer license. It takes 5 minutes and you will be able to lock your rate for the next 90 days (in case you want to purchase the bond).

Vehicle, used vehicle and motorcycle dealers are required to obtain a surety bond.

Bond Amount Required:

$25,000 for new and used vehicle licenses

$5,000 for motorcycles and snowmobiles

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Complete the Dealer License Plate Application

Complete the Dealer License Plate Application and submit the appropriate payment ($84 annually per Dealer 77 plate).


Submit Your Dealer License Application

The dealer license application must be completed in its entirety and submitted with:

  • Original surety bond
  • Certificate of public liability insurance
  • Written verification of conformance with land use ordinances, building codes, and zoning from the city or county

Fee: $300 for new and used dealer licenses

Mail your completed application to:

Motor Vehicles Division

445 E. Capitol Ave.

Pierre, SD 57501

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