What is the invoice price?
What is the new car invoice price exactly? It is the amount the dealer pays the manufacturer for the vehicle—well, some of the time. Often times, however, the dealer actually paid less than the new car invoice price, this is called the dealer price. Invoice prices can be inflated so that those buying at fleet prices will be getting a discount without the dealer losing money. You want to use the new car invoice price as a starting point when you start to settle on a number with the car salesman.
How to find the invoice price:
Finding the invoice price is easy. You can look on the manufacturer’s website, but it is probably easier to look at websites specifically designed to help with car shopping. If the car you are looking at buying is in high demand, the dealer may laugh at you when you start dealing at the new car invoice price, so be prepared for that. If the dealer is running a zero percent interest incentive, or a factory rebate, keep those deals in mind as you are negotiating to get the best deal possible.
The difference between MSRP and invoice price:
Don’t be confused, there is a difference between invoice price and MSRP. The Manufacturer’s Suggested Retail Price (MSRP) is also known as the list price, or the sticker price. It is the most that the car will be sold for. But it is not the amount that you should pay for your car!
The Manufacturer’s Suggested Retail Price is usually two or three thousand dollars more than the invoice price. The invoice price is usually three or four hundred more than the amount the dealer actually pays for the vehicle. You can look up on the internet invoice and MSRP differences for most makes and models of vehicles.
Bargaining for your car:
If you are going to go into the car dealership, you should know what car or cars you are interested in buying, narrow it down to a few or write information down. You should know the MSRP and the invoice price, so that you will be able to haggle with the dealer. If you don’t want to go into the dealership, that’s OK, but you will still need to know those numbers. There are several websites that allow you to give your e-mail address or phone number to car dealerships in your area. They will send you the best price that they can offer on that vehicle. Their best buy should be close to the invoice price. Either way you deal with the dealer, start at the low number (the total dealer cost) and move toward the MSRP, not the other way around.
It is also good to pay attention to financing incentives and new car rebates that are offered by the dealership or manufacturer. Depending on how desperate the car dealership is to sell the car, they may or may not combine these offers with the invoice price.
By Clint Hunter