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Want to Know What a Dealer Pays for the Car?

The true dealer cost is the lowest possible price you can pay for a new car. It takes into account all the variables included in the dealer invoice, including the dealer holdback. Figuring out the true dealer cost, and how much the dealer paid for the car, will help you pay less for any type of new car!

The dealer may decide to sell you a car at true dealer cost because they need to sell inventory. Furthermore, if they see an opportunity to make money financing your auto loan or with your trade-in vehicle.

An important factor that will help save you money is the dealer holdback. The dealer holdback is part of the dealer invoice. It is estimated to be 2%-3% of the vehicle MSRP, but varies by auto manufacturer. This amount will be ‘given back’ to the dealer after they sell the car.

The dealer holdback is used by car dealers to pay for selling expenses such as salesman commissions, advertising expenses, and showroom expenses.

This is why it’s important to make local dealers compete for your business. When dealers compete, you win! Find out which dealers have the car you want, and which ones are the most motivated to sell it due to overstock inventory.

We will help you to easily find the lowest car prices in ! Request a FREE Car quote and get access to our nationwide database of car dealer offers that give honest and upfront pricing, along with the best financing options in !

Can Competing Dealerships (as far as 100 miles away) Give Me an Incredible Deal?

Yes. Car dealerships earn money by selling cars, the higher turnover of cars they sell, the better the relationship they have with the auto manufacturer. Which means the auto manufacturer will give them more of the most popular cars, in the best colors, and with standard options. The dealership will also make money financing your car and, if applicable, on your ‘trade-in’. The more cars the auto dealership sells, the more profit they will earn. Remember, car dealerships, even those who are as much as 60 to 100 miles away, are willing to offer rock bottom prices, special incentives, and attractive financing rates in order to successfully compete for your business.

Competing Car Dealerships Offer Fantastic Trade-In Values and Service Discounts

What is the Dealer Invoice?

The dealer invoice or the factory invoice is not the MSRP. It is popularly called the ‘wholesale price’, or the amount the factory charged for the car.

Depending on the car dealer and the manufacturer, the dealer invoice can be divided into 4 categories:

  1. Base Invoice – the factory price of the car, without options installed.
  2. Options Invoice – the amount that reflects the price of additional accessories installed on the vehicle upon delivery.
  3. Destination Fee – the amount charged by the factory for delivering the car to the dealer; and
  4. Manufacturer Fees – the sum of additional fees the dealer has to pay to the manufacturer.

How Do Car Salesmen Earn Commissions?

Once you understands a car salesmen’s commission, you will clearly see why it’s crucial you receive competing car prices. How much commission a salesmen earns, can increase or decrease, depending on how badly they or the dealership needs to move car inventory.

This translates into opportunities for you to negotiate the best possible sale price for the car you want.

The exact amount will depend on the car dealership and the manufacturer. Car salesmen earn a living through the following means:

  1. Front–End Commissions – let us assume a car has an MSRP of $25,000, with a dealer invoice of $23,500. In this case, the ‘front-end’ profit is $1,500. If the dealership pays 40% commission for every sale, then the salesman can pocket $600 for each sale. Commission percentages will also vary according to the dealer.
  2. Vehicle Extras and Add-On Incentives – car salesmen earn commissions from selling you vehicle extras such as rust proofing, undercoating, and paint protection. Additional accessories such as an upgraded audio system, bigger wheels and tires, and vehicle security systems will also help the salesman earn more commissions.
  3. Bonuses/Extra Incentives – car salesmen also earn additional bonuses and incentives if they reach the sales quota of the dealership. For example, a particular dealership may reward an additional $400 bonus if the salesman sells 10 cars within the month, or $600 for 15 vehicles sold in a given period. These figures may vary.
  4. Miscellaneous Bonuses – car dealerships also offer miscellaneous bonuses such as weekend rewards (for successfully selling a car on a weekend) and holiday incentives (for selling a car during a holiday).

Request a FREE Car quote and find out what other people are paying for the car you want! You will also find available rebates, incentives, and special discounts on selected vehicle models, along with the best possible deals in !

It's Easy, Dealers Compete, You Save
New car dealerships are competing more fiercely than ever to gain your business. Request free competing price quotes from multiple pre-approved new car dealers. Lock-in the lowest available price in your area before visiting the dealership. Gain the negotiation tools you need to guarantee paying the lowest price, hassle-free.
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Car buyers equipped with pre-approved price quotes, dealer rebates and incentives are guaranteed to pay less. Know actual dealer cost, factory invoice price, and MSRP. Pay less than sticker price, deduct bonus cash rebates, secret dealer incentives, and special internet discounts. Informed new car buyers never need to haggle. Request free competing new car price quotes and uncover the savings today!