What Does MSRP Mean? – Autoblog

When looking to purchase a new car, understanding the concept of MSRP, or Manufacturer’s Suggested Retail Price, is crucial. This is the price suggested by the manufacturer for the dealer to ask for the car, also known as the sticker price. While MSRP is typically seen on the Monroney label on the car window, it is not necessarily the price you have to pay. Dealerships can negotiate prices below the MSRP, especially when demand is low.

The MSRP is determined by the manufacturer by adding the base price, destination charges, and any additional options on the car. It does not include sales tax, registration fees, or any gas guzzler taxes, if applicable. The invoice price, which is what the dealer pays the manufacturer, is usually lower than the MSRP by a few hundred or thousand dollars.

Negotiating below the MSRP depends on various factors such as the car model, supply, demand, and available incentives. Slow-selling models are likely to have more room for negotiation, while newly launched or high-demand cars may come with markups above MSRP. Researching the market value of the car can help you determine a fair price to negotiate at the dealership.

While the MSRP is a good starting point for comparing vehicle prices, be sure to keep an eye out for manufacturer promotions and sales. Waiting for the right timing can often result in a better deal below the listed MSRP. In times of supply shortages, it may be wise to postpone purchasing a new car to avoid paying more than the MSRP. Stay informed and leverage your knowledge of MSRP to make a smart purchasing decision in the automotive market.