New Mitsubishi Prices: MSRP, Factory Invoice vs True Dealer Cost
Most people mistakenly believe that the Mitsubishi Invoice Price reflects what the dealer paid for a new vehicle - The true Dealer Cost. It is not!
The Dealer Invoice Price has hidden mark up such as holdback and other fees built into the price.
The following Mitsubishi 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.)
Knowing the dealer cost of a new Mitsubishi 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.
Mitsubishi Price Terms & Definitions
MSRP
The Manufacturer’s Suggested Retail Price (MSRP) is the price for a specific vehicle as suggested by a vehicle manufacturer. Dealers do not need to sell the vehicle for this price.
The dealer invoice price is the amount a vehicle manufacturer bills to a dealer for a specific vehicle that has been delivered to the dealer. All fees, charges, and vehicle options are included on this invoice.
Dealer holdback is an amount of money from each vehicle sold that a vehicle manufacturer holds for several months before transferring it to the dealer. Dealer holdback is similar to a dealer discount because it lowers the amount of money a dealer must pay a vehicle manufacturer for a vehicle it sold.
Manufacturer Incentives and Rebates
Incentives and rebates are sums of money a vehicle manufacturer gives to a customer for the purchase of a specific vehicle. These incentives and rebates are often used to spur lower than expected sales of a vehicle model.
The Destination fee is charge for delivering a vehicle from the vehicle manufacturer’s factory to a dealer.
A dealer incentive is money a dealer receives from a vehicle manufacturer for selling a vehicle. Sometimes a dealer will use this money, or a portion of it, to reduce the price quoted to a customer for a vehicle.
Regional ad fees are for vehicle advertisings in the dealer’s geographical area that are not specific to that dealer. These ads may promote a specific vehicle model, or the entire lineup of a manufacturer’s vehicles, but will not promote any specific dealer.
True Deal Cost - The actual price Mitsubishi dealers pay for their new vehicles. Here is how it is calculated:
Formula for Calculating Dealer Cost of a New Mitsubishi:
- Base Mitsubishi 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 Mitsubishi is 2% of the Base MSRP. (See the New Car Dealer Cost Example.)
Total Dealer Cost - Rebate and Incentive + Taxes / Licensing Fees = True Dealer Cost.
