Buick Prices: MSRP vs Factory Invoice vs True Dealer Cost
The Dealer Invoice Price has hidden mark up such as holdback and other fees built into the price.
The following Buick price guides strip these hidden dealer profits out and illustrate the MSRP, the invoice price, Holdback and the true dealer cost. (See Buick price definitions below.)
Why You Should Know the True Dealer Cost...
Knowing the dealer cost gives you needed leverage when it comes time to negotiate a great price. Negotiating from the cost up and not the MSRP down can save you thousands on your next purchase.
Buick Price Terms & Definitions
When buying a new car, there are some terms that you may be unfamiliar with. These terms mean, might lead you to spend money that you didn't want to. Today we look at the different terms that may come up when looking for a new car.
MSRP: This is also known as manufacturer suggested retail price, which is the price that the manufacturer sets for its products.. Usually the dealer ship price is higher in order to make a profit
Dealer Invoice Price: This is the price that the dealership has to pay to get the car from the manufacturer. It doesn't necessarily mean that it is the exact cost that they selling it to you.
Dealer Holdback: The price that the factory pays to the car dealership. Since there is a lot of car in the lot, the dealership has to take out loans. The holdback money is the money that covers the interest of the dealership for their loans.
Dealer Incentives: These are incentives form the factory to the dealer that reduce the true cost of the vehicle. They happen because the factory wants to increase the sales of a certain model of car.
Regional ad fees: The cost of business that the dealer pays for advertising and promotions that the factory runs in the given area. These fees may be included in the invoice of the car.
Destination fees: These fee occur because of the cost to ship the vehicle from the factory to the dealership. It is also in the invoice price, and this fee is usually at a fixed price and unavoidable.
Manufacturer's rebate/incentive: This happens when there is too much of one model of car. When this happens the factory offers some sort of incentive for people to buy the car.
True Deal Cost - The actual price Buick dealers pay for their new vehicles. Here is how it is calculated:
Formula for Calculating Dealer Cost of a New Buick:
- Base Buick Invoice Price + the dealer Invoice price of Options + Destination - Holdback = Total Dealer Cost.
- What is Dealer Holdback? A hidden amount that manufacturers give back to a dealer. It is a percentage of the MSRP or the Invoice price. The holdback for Buick is 3% of the Total MSRP. (See the New Car Dealer Cost Example.)
Total Dealer Cost (calculated above) + Taxes / Licensing Fees - Rebate / Incentive = True Cost (See New Car Rebates and Incentives.)