It can be very confusing for a buyer to determine what a fair and reasonable price to pay for a new car is, especially when bombarded with all different price points – the factory invoice price, the manufacturer’s suggested retail price, the dealer invoice price – it’s no wonder why so many new car buyers end up paying a lot more than they should for a new car.
When you understand the terminology used in the industry and receive the dealer invoice price list with your free, no obligation to buy new car price quote you’ll know what the true dealer cost is and the right price to pay for a new car.
- The dealer invoice price is what the automakers charge dealerships for the new cars they buy and includes any factory-installed options.
- The factory invoice price is the dealerships total cost for a car. This price includes the cost of the base model of a vehicle, the cost of any options, manufacturer fees and destination charges.
- The MSRP is just what it implies; the “manufacturer’s suggested retail price” and is simply the magic number (price) the automaker suggests the dealerships charge for a vehicle.
- The sticker price you see on the window of a new car is the amount the dealership would like to sell a car for. Often, they will put how much their invoice price is, along with the MSRP, so buyers think their lower sticker price is a great deal.
When you know the dealership’s true cost along with their potential for generating a ton of profit, you can use that to negotiate a much better price.
Now that you’ve learned how to decipher all of the prices that car dealerships will throw at you, find the dealer invoice price and get on your way to buying a new car at a fair price that you, and your wallet, can live with.