Know the numbers.For the dealership the most obvious source of revenue is the sale price of the vehicle. How much should I pay for new car? What is a reasonable price to pay for a new car? These are questions that are not very easily answered. Let's start off with what all of the numbers mean when it comes to pricing on a new car. The first number most of you have already seen is the MSRP, the Manufacturer Suggested Retail Price. This is the price that is dictated by the Manufacturer of the vehicle and will be the highest price written on the vehicle Window Sticker. There are only a few exceptions when a vehicle might command MSRP as the sale price. This would only be the case with rare vehicles in extremely high demand, like a brand new Hybrid that just came out or a limited production sports car like the Corvette ZR1 or Mustang Shelby GT350R when it was first released.
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The next price point that most of you I'm sure have heard but don't 100% understand is invoice. When you think of invoice you automatically assume this is the cost of the vehicle to the dealership. In a lot of cases dealers will take advantage of this and present it as their actual cost for the car. The invoice price is what the dealership pays for the vehicle, but it's not cost. When a vehicle is sold by the dealership they receive what's called holdback. This amount is written right on the invoice and can range between 1%-3% of the MSRP of the vehicle. The invoice price minus holdback is what it costs the dealership to obtain the vehicle.
So now the big question... how much should I pay for a new car? Well that depends. If it's a vehicle that's in high demand and low supply such as a new model that just rolled out you can expect to be anywhere from $1,000 over invoice to MSRP. After supply catches up to demand and the vehicle is more readily available you should be able to get your price at invoice or at least $200-$300 above. If you're a good negotiator and can really work a deal getting yourself below invoice is not unreasonable.
So now the big question... how much should I pay for a new car? Well that depends. If it's a vehicle that's in high demand and low supply such as a new model that just rolled out you can expect to be anywhere from $1,000 over invoice to MSRP. After supply catches up to demand and the vehicle is more readily available you should be able to get your price at invoice or at least $200-$300 above. If you're a good negotiator and can really work a deal getting yourself below invoice is not unreasonable.
Why use an auto broker car buying service to help with a new car?
Our professional car negotiators have years of experience in the automotive industry and know every aspect of the business. With over 15 years of management experience in a car dealership, we know what it takes to get you a great deal. We know what the dealership owns the vehicle for and can negotiate you the best price on any new make or model. From finding vehicles, negotiating pricing, financing, to trade-in values, we can help. We do not work for the dealer, nor do we accept commission or any form of payment from the dealership. We work for you, and only you, the car buyer! Buying a car is the second biggest, if not the biggest purchase you will make in your lifetime. Would you buy a house without a broker? Don't make that mistake when buying a car. We are your personal car negotiator.