Understanding Difference Between MSRP and Invoice Prices

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• published: 18 Feb 2015
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CarLingo New Car Shopping Tip #16 - Understanding Difference Between MSRP and Invoice Prices Summary :•“MSRP” is the Manufacturer’s suggested retail price •Dealers are free to sell the vehicle for an amount that is higher or lower than the MSRP, based on the supply and demand of the car model •Cars with “Base Price” does not come with basic equipments. It is the initial figure you see in pricing guides but you won’t find these base cars attractive •“MSRP” is also known as the “sticker price” •“Invoice Price” is the figure printed on the dealer’s invoice from the manufacturer. It is available online and often listed in automaker websites. You can use that as a guide to purchase your new car! Transcription: When it comes to car prices, much of the language used can be very confusing. A good example is the difference between “MSRP” and “Invoice Price”. How is it consumer make to understand the differences between all these car pricing terms mean? We will take the time today to find the difference between these two thing, which is vitally important to you as you are shopping for your new car. The “MSRP” is the Manufacturer's Suggested Retail Price. This is the often referred tool price that the automaker publishers for any given models in term line. Because it’s “suggested”, dealers are free to sell the vehicle for a figure either higher or lower than the MSRP, typically based on the supply and demand of a particular car you’re looking for. The “Base Price” excludes any options, destination charge or other fees, is the initial figure you will find in pricing guides most car reviews and on pricing websites. These cars are often missing basic equipments, that means you wouldn’t find these base cars very attractive. More importantly, the total MSRP commonly called the “sticker price” because it is the bottom line figure on the car window sticker is the base price plus any option, option package discounts and destination charges. Unless the model is in very high demand, you can generally buy a vehicle for less than a sticker price. The Invoice Price is the figure printed on the dealer’s invoice from the manufacture. Once very difficult to find, invoice prices are now commonly available online and in online pricing guides. In fact, dealer invoice price are becoming so well known that they are even listed on some automaker websites. In addition, at many dealerships, salespeople will be glad to review to you the invoice for the car that you’re interested in, often as a way to let you know how little mark up there is and get you closer to purchase that. But what you see on the invoice price is just part of the pricing puzzle, but it does get you well prepared for your new car purchase. Good luck with negotiation. www.carlingo.com