What Does MSRP Mean?

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When searching for a new vehicle, you’ll see the mention of an MSRP. What is an MSRP and what does MSRP stand for? Our finance team at Santa Cruz Chrysler Dodge Jeep Ram can help. MSRP stands for Manufacturer Suggested Retail Price. This is the number that the manufacturer of the model recommends that the dealership sells a vehicle for. This is also known as the list price. The MSRP is determined by market information on the vehicle’s popularity, the materials that go into building it, and more. Learn about the meaning of MSRP, the difference between MSRP vs. invoice price, and more with our team at Santa Cruz Chrysler Dodge Jeep Ram in Santa Cruz.

What is MSRP?

The MSRP meaning is the price the manufacturer recommends the dealer sell the vehicle for. So what is an MSRP? Take a closer look at this information to help you better understand MSRP:

  • 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 Capitola 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?

While the MSRP is the price the manufacturer recommends, this isn’t always the price you have to pay for the vehicle.

  • Do your research by checking what other Santa Cruz 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 Santa Cruz Chrysler Dodge Jeep Ram! 

After learning what an MSRP is, get the process started on your favorite model from our Watsonville inventory at Santa Cruz Chrysler Dodge Jeep Ram. When you want a new vehicle to show off around Scotts Valley, make the trip to our dealership. If you have questions in the meantime, contact our team.

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