When navigating the world of car buying, you’ll encounter various prices, but two stand out: the MSRP (Manufacturer’s Suggested Retail Price) and the Invoice Price. Think of MSRP as the sticker price, while the invoice price represents what the car dealership essentially pays the manufacturer – the wholesale cost. To truly master car deals and potentially save thousands, understanding the invoice price and how it plays into a dealership’s “invoice buying program” is crucial.
Many car buyers understandably focus on negotiating down from the MSRP. However, seasoned negotiators know that the real leverage lies in understanding and utilizing the invoice price. The invoice price is your starting point for serious negotiation. But here’s a key insider secret: the dealership’s actual cost is often even lower than the invoice price. This is because dealerships benefit from various manufacturer incentives, rebates, and holdbacks that are not immediately apparent.
Therefore, aiming to buy a car at, or even below, the invoice price is not just a pipe dream – it’s an achievable goal, especially on less popular models. A strategic car buying method centers around negotiating upwards from the invoice price, not downwards from the inflated MSRP. To do this effectively and confidently engage with a car dealership’s invoice buying program, you absolutely need to see the official vehicle invoice.
The reason viewing the invoice is so critical is to protect yourself from deceptive tactics. Some less scrupulous dealerships might try to inflate prices using a “fake” invoice, often padded with unnecessary and overpriced add-ons. These could be presented as mandatory “Dealer Protection Packages” that offer dubious value, like fabric protection or paint sealant, sometimes costing hundreds or even thousands of dollars. These inflated costs are designed to boost dealer profit at your expense.
To cut through the sales tactics and truly understand the car dealership invoice buying program, insist on receiving a copy of the official manufacturer’s invoice. Request that dealers email or fax you this document. The official invoice is your transparent window into the true cost, detailing all factory-installed options and legitimate fees included in the invoice price.
Beware of “dealer-generated invoices.” These are internal documents dealerships create themselves and are not the official manufacturer’s invoice. They often include dealer-installed accessories and markups, obscuring the real factory invoice price. A genuine vehicle invoice is easily identifiable: it will prominently display the car manufacturer’s logo at the top and will be addressed directly to the dealership. It provides a comprehensive breakdown of all factory-installed options, each with its corresponding invoice price. Legitimate regional advertising fees or other unavoidable charges may also be listed.
To illustrate, here’s what a real vehicle invoice typically looks like:
In some rare situations, a dealership might resist providing the official invoice, citing “dealer policy” or simply due to reluctance to be transparent. If you encounter this resistance, pay close attention to the invoice price they verbally quote. Compare this quoted price against invoice information you’ve gathered from other dealerships or reputable online sources.
By obtaining vehicle invoices from multiple dealerships, you create a benchmark. This allows you to quickly identify if a particular dealer is attempting to manipulate invoice numbers or obscure costs within their invoice buying program. Knowledge is power in car negotiations, and the invoice price is your most powerful tool.
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About The Author
Gregg Fidan is the founder of RealCarTips. After being ripped off on his first car purchase, he devoted several years to figuring out the best ways to avoid scams and negotiate the best car deals. He has written hundreds of articles on the subject of car buying and taught thousands of car shoppers how to get the best deals.
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