What Is MSRP?

As you’ve been shopping for a new vehicle in the The Woodlands area, you’ve undoubtedly encountered the term “MSRP” somewhere along the way. If you’ve ever wondered what this term actually stands for, MSRP means “manufacturer suggested retail price,” meaning the price at which a manufacturer recommends a dealership sell a certain vehicle. Learn some of the basics of MSRP and how you can use it to your advantage with the finance center at Tom Peacock Nissan.

What Does MSRP Mean for You?

Now that you know what MSRP is, let’s talk about what MSRP means for you as a shopper. To help you use MSRP to your advantage, here are some things you should know about MSRP: 

• Since the MSRP is set by the manufacturer, the MSRP for a certain vehicle will be the same across all Spring dealerships.
• The MSRP will be the same for each vehicle of the same model but not for each vehicle sold by the manufacturer. For example, a truck will have a different MSRP than a sedan. 
• You can find a vehicle’s MSRP on the manufacturer’s website or on the dealership’s website. 

What Determines the MSRP?

There are several different factors that go into setting the MSRP for a certain vehicle, like manufacturing costs, markup changes, and other data that the manufacturer uses. Here are some things that contribute to the MSRP of a certain vehicle: 

• The MSRP determines the vehicle’s base price at the base-level trim without any extra features or accessories. The more features and the higher the trim, the higher the MSRP. 
• The MSRP is recommended by the manufacturer, but it’s not the price at which a dealership is required to sell a vehicle.
• The dealership may lower the price of a vehicle depending on the invoice price, which is the price that the dealership paid for the vehicle. 
• A popular model will likely be sold closer to the MSRP while a less popular model may be sold at a lower or discounted price. 

The invoice price is usually lower than the MSRP, and the difference is usually thousands of dollars, meaning that the dealership will still profit by selling the vehicle to you at a lower price than the MSRP. 

Getting a Fair Price

Now that you know what MSRP means and what determines the MSRP, you can use this knowledge to your advantage during your Conroe car-shopping trip. Here are some ways you can negotiate a fair price: 

• Research your vehicle to see what other drivers have paid for it.
• Start your offer below the MSRP so that you can work your way up. 
• While dealerships aren’t obligated to show you the invoice price, you can still ask to see it. 
• Look at multiple dealerships and compare offers. 
• Even if you plan to lease, you can negotiate the MSRP since the monthly payments are set by the final price. 

So, what does MSRP mean? It’s the price recommended by the manufacturer but not the price at which a dealer has to sell a particular vehicle. You can use this to your advantage when shopping for a new vehicle. 

Get a Fair Price at Tom Peacock Nissan 

Knowing what MSRP is and how it can help you negotiate the price you prefer is a great advantage during your Houston car-buying experience. Contact us for more finance tips and to answer any of your car-buying questions.