What Does MSRP Mean?

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What is MSRP? If you’ve just begun your search for a new vehicle, you’re likely wondering about the definition of MSRP. Meaning “manufacturer suggested retail price,” this acronym tells you how the manufacturer thinks a vehicle should be priced at Hood River-area dealerships. Manufacturers use information about the model’s sales history, popularity, building materials, and more to determine MSRP. However, this amount is a suggestion — and dealerships aren’t actually required to sell their vehicles at MSRP. Below, we’ll delve into the MSP meaning, as well as the difference between MSRP vs. invoice price.

What is MSRP?

Want to know more about what MSRP is used for? Knowing a vehicle’s MSRP can be helpful in determining whether you’re getting a fair price at the dealership. Here’s what to keep in mind about the MSRP meaning:

  • The price is set by the manufacturer, so the same make and model will have the same MSRP at all dealerships.
  • Different models in a manufacturer’s lineup — as well as different configurations in a model’s trim lineup — will have their own unique MSRP. For instance, a larger vehicle that requires more building materials or a configuration with more advanced technology will probably have a higher MSRP than a compact model or entry-level configuration, respectively.
  • You can always find a vehicle’s MSRP on the manufacturer’s website, and you should feel free to use it when negotiating the price of your new vehicle. 

How is the MSRP Set?

  • A vehicle’s MSRP is the suggested price of its entry-level configuration without additional features add-ons.
  • Higher trim levels may have their own starting MSRP.
  • The MSRP is recommended by the manufacturer, but dealerships may sell a vehicle for above or below MSRP for a number of reasons.
  • The dealership may raise or lower the selling price depending on how much they paid for the vehicle.
  • Demand also impacts the selling point a dealership chooses for a vehicle. While popular models are more likely to be sold at or near MSRP, less popular models may be sold at a lower price.

MSRP vs. Invoice Price

You may hear dealerships reference a vehicle’s invoice price. So, what’s the difference between MSRP vs. invoice price? 

  • Invoice price is the amount the dealership pays the manufacturer for the vehicle.
  • MSRP (also known as the “sticker price”) is the suggested retail price for the vehicle.
  • The price of the vehicle at the dealership is its selling price. 

What is MSRP used for? Keep in mind that there’s usually room to negotiate on the price of a vehicle, and knowing the MSRP can help you make sure you’re getting a fair price.

How Do I Get a Fair Price?

  • Do your research – Find out what other Goldendale, WA-area drivers paid for the same model with tools from sites like Kelley Blue Book, Edmunds, or Cars.com.
  • Start below MSRP – When negotiating on price, be sure to start below MSRP and work your way up. Be sure to factor in the cost of any accessories you’d like to add. The invoice price may help you to determine a good starting point for your negotiation, as well.
  • Ask for the invoice price – While some dealerships will show you a car’s invoice price if you ask, they’re not required to do so.
  • Check prices at multiple dealerships to be sure you’re getting the best price in Portland.
  • Planning to lease? You can still negotiate the MSRP because the price of the vehicle will determine your monthly payment amount.

Learn More About MSRP Meaning with C. H. Urness Motors Co.! 

If you have further questions about MSRP vs. invoice price and how to negotiate effectively, we’re happy to help! Contact our team of auto finance experts with your car-buying questions, or stop by the finance center at our dealership in The Dalles. You can also get started from home with our online financing application.


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