Oct 30th, 2007 by jbrown
So which is more important? Which is the one I should expect? Cars.com explains it nicely…
“Although we can say it as simply as possible, invoice and MSRP prices simply aren’t that simple. The Cars.com article “Getting the Best Deal: Purchase Price and Trade-Ins” explains why:
‘For most vehicle makes, the published invoice price is not the true dealer cost because of dealer holdback. Holdback is a portion of a car’s sales price (typically 2 percent to 3 percent of either the invoice price or MSRP) that an automaker returns to a dealer, usually on a quarterly basis. It’s a way of boosting the dealer’s cash flow and helps the dealer keep his lights on.’
More and more consumers are entering dealership lots armed with an invoice price and MSRP in hand. Although these are important numbers to know, they shouldn’t be relied on solely during negotiations as the price you expect to pay. A good starting price — and a more realistic number for negotiations — is the Cars.com Smart Target Price, which is calculated considering invoice price and MSRP among many other factors; like vehicle availability and demand. On most cars; the Smart Target Price lies somewhere between invoice and MSRP.”
Here is their Smart Target Price:
http://www.cars.com/go/configurator/targetPriceExplainer.jsp
Here is the article:
http://ask.cars.com/2007/10/what-is-invoice.html
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Augusta
Amazingly I was only writing a similar post to my blog this morning.. great minds think alike 😉