What Does MSRP Mean?

In the market for a new vehicle and wondering what an MSRP is? MSRP stands for Manufacturer Suggested Retail Price. It’s the price that the manufacturer recommends a Eden Prairie dealership sells a vehicle at. Also known as the list price, the manufacturer determines this price based on market information on the vehicle’s popularity, the materials that go into building it, and more. Learn more about the meaning of MSRP and the difference between MSRP vs. invoice price with the help of Metropolitan Ford of Eden Prairie! 

What is MSRP?

Want to know more about MSRP meaning and details? The MSRP is the recommended price at which dealers should sell a vehicle. Let’s dive into what an MSRP is so you can feel confident before car shopping in Edina!

• A particular model will share the same MSRP across all dealerships, as the price is set by the manufacturer.
• While the MSRP is the same for each vehicle of the same model, it won’t be the same for every vehicle the manufacturer sells. For instance, SUVs will have a different MSRP than a sedan or a truck. 
• Car shoppers can find the MSRP on the manufacturer’s website or the dealer’s website, and they can use it when negotiating the price of their new vehicle. 

How is the MSRP Set?

• The MSRP sets a vehicle’s base price at its entry-level configuration without additional features or accessories. 
• Additional features and higher trim levels will raise the cost of the vehicle accordingly. 
• While the MSRP is recommended by the manufacturer, it’s not necessarily the price the dealership will choose to sell the vehicle at. 
• Depending on the invoice price for the vehicle – the price the dealership paid for the vehicle – the dealer may raise or lower the price of the car for Chanhassen shoppers.
• Demand also plays a role in how much a vehicle costs. A popular model will most likely be sold closer to the MSRP, while a less popular model may be set at a discount. 

MSRP vs. Invoice Price

You may hear the term “invoice price” while car shopping, but how do you differentiate between MSRP vs. invoice price?

• Invoice price (or dealer price) refers to the amount a dealer pays the manufacturer 
• MSRP is the “sticker price” (i.e. the amount you’ll be paying the dealer)

Keep in mind that the MSRP is “suggested,” so there’s typically room to negotiate. Knowing the MSRP vs. invoice price will help you determine what a fair negotiating price will be.

How Do I Get a Fair Price?

The MSRP may be the price the manufacturer recommends for the vehicle, but it is not the price you have to pay for a vehicle. 

• Do your research by checking what other Eden Prairie drivers have paid for the same model on sites like Kelley Blue Book, Edmunds, or Cars.com.
• Start your negotiation below the MSRP, and work your way up from there – keeping in mind any additional features you want and what they may cost. 
• Some dealers may let you see a car’s invoice price if you ask; however, they are not obligated to. The invoice price can help you determine where you should start your price negotiation.
• Shop at multiple dealerships until you find the one that can get you a price you are happy with.
• If you plan to lease, you can still negotiate the MSRP since the price you and the dealer agree on will determine your monthly payment costs. 

Learn More About MSRP Meaning with Metropolitan Ford of Eden Prairie! 

Now that you know more about what an MSRP is and the difference between MSRP vs. invoice price, get in touch with our finance center to get the car-buying process started! We’ll help you get a great price on your next vehicle when you apply for financing! Get the car you need for your Edina lifestyle when you shop with Metropolitan Ford of Eden Prairie!