What Does MSRP Mean?

Finance Paperwork with Glasses

If you’re looking for a new or pre-owned vehicle in the Nisswa area, you’ve probably come across the term “MSRP” next to a vehicle’s price tag. What is MSRP? In short, it stands for Manufacturer Suggested Retail Price, and it’s a number that the manufacturer recommends a dealership sell a car at. The MSRP of a vehicle is determined by a wide variety of factors, such as vehicle popularity, condition, materials, market information, and more. The finance team at Tanner Nissan has more information on the MSRP meaning, as well as MSRP vs. invoice pricing, in the guide below – check it out!

What is MSRP?

Now that we know the basics of the MSRP meaning, let’s get into more details. Here are some fast facts about how to analyze a vehicle’s MSRP:

  • Since a vehicle’s MSRP is set by the manufacturer, it will be the same regardless of which dealership you go to.
  • Different classes of vehicles have different MSRPs depending on their size, specs, and conditions.
  • You can find a vehicle’s MSRP either on the manufacturer’s website or on the dealership’s website. If you see that the dealer is offering the vehicle at a higher price, you can use the MSRP to negotiate the cost down.

How is the MSRP Set?

  • A vehicle manufacturer sets the MSRP based on the entry-level trim without additional features, add-ons, or accessories.
  • Once you start adding additional features and amenities, the price of the vehicle will go up.
  • As the name suggests, the MSRP is simply a recommendation by the automaker, and not necessarily a guaranteed price that the dealership will use.
  • A vehicle’s price is also affected by how in demand it is–less popular vehicles are typically sold at a discount, while popular vehicles will be sold closer to the MSRP.

MSRP vs. Invoice Price

In addition to MSRP, you may have come across the term “invoice price” while shopping for a new car in Aitkin. While these both refer to the cost of a vehicle, they’re a bit different:

  • MSRP is the “sticker price” set by the manufacturer that you’ll be paying for the dealer. It’s suggested by the automaker, so there’s typically room to negotiate if you think you can get a lower price.
  • Invoice price is the amount that a dealer pays the manufacturer for a vehicle.

How Do I Get a Fair Price?

As we discussed above, the MSRP is not necessarily the guaranteed price you’ll have to pay. At Tanner Nissan, we’re always open to negotiating the cost of a new or pre-owned vehicle. Here are some details:

  • If you think you can get a better deal, do some third-party research by checking out resources like Edmunds, Kelley Blue Book, or Cars.com.
  • Start to negotiate below the MSRP and work your way up from there.
  • Ask the dealer if you can see the car’s invoice price–while they’re not obligated to show you, they may let you see it if you ask.
  • Don’t be afraid to shop around at different dealerships until you get the deal you want.
  • If you’re leasing a vehicle rather than purchasing it, you can still negotiate the MSRP to determine your monthly payments.

Find Your Next Ride at Tanner Nissan

If you have any questions about the MSRP meaning, MSRP vs. invoice, or anything else we’ve discussed above, feel free to contact our office! You can also stop by our dealership to talk to a member of our finance team in person–we’re conveniently located near Bemidji and happy to help you out. Be sure to check out our car buying tips for more advice on finding your next ride!

 

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