Lincoln 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 Lincoln price guides strip these hidden dealer profits out and illustrate the MSRP, the invoice price, Holdback and the true dealer cost. (See price definitions below.)
Why You Should Know the True Dealer Cost...
Knowing the dealer cost of a new Lincoln 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.
Lincoln Price Terms & Definitions
The world of auto dealership and manufacturing can be confusing, particularly if you do not know the lingo. Take the time to learn some key car phrases and definitions, and it just might help you out the next time you step into a dealership to negotiate.
The MSRP is the manufacturer's suggested retail price, and this is the figure manufacturers recommend dealers set their vehicles at.
Dealer Invoice Price
The dealer invoice price is the sum the manufacturer invoices the dealer for, as well as the added options a consumer might opt for in his or her purchase. This is the dealer's true cost.
The dealer holdback is a platform of payments set up to enable the dealer to keep new models on the show room. The dealer finances the cars through the dealership's financial group.
Manufacturer Incentives and Rebates
Manufacturer incentives and rebates are incentives and cut backs made directly from the auto maker to the consumer. These rewards are designed to entice the buyers by promising discounts and money rebates in exchange for their patronage.
A destination fee is basically a delivery cost, which the manufacturer averages over all the vehicles so it is not added on individually by the dealers.
Dealer incentives are incentives offered from the factory directly to the dealer, in an aim to move a certain model or stock that may be in surplus. Often these incentives are goal base, like reaching a certain sale level to get a greater rebate.
Regional Ad Fees
Regional ad fees are extra costs the dealer pays to the vehicle manufacturer, to cover any advertising or promotions the manufacturer might be doing in the dealer's area. These fees are itemized on the vhicle's invoice, and you cannot typically negotiate these fees.
True Deal Cost - The actual price Lincoln dealers pay for their new vehicles. Here is how it is calculated:
Formula for Calculating Dealer Cost of a New Lincoln:
- Base Lincoln 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. Lincoln has No Holdback. (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.)