Question on buying prices.
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Senior Member
Joined: Mar 2012
Posts: 181
Likes: 22
Question on buying prices.
Can anyone explain to me in simple terms about pricing?
What is a rebate?
What is a package discount?
How do these effect MSRP?
I always looked at the final out the door price. I never worried about what was actually a rebate or how much the dealer is discounting the price.
So say the MSRP on ford.com says $37500 for the model and options I want. Say invoice is $35000. Say I want the costco discount which say is $500 above invoice.
That brings the price to 35500. Then say I use the $750 coupon. Price is now $34750. Say then have $4000 in rebates. This brings the price to $30750. This is a bit higher than the price I would actually like to negotiate.
Couldn't I just find a dealer to sell a truck to me for a bit cheaper without worrying about the rebates and the costco price? At that point after negotiating, couldn't I just pop out the $750 coupon and get an overall lower price.
It seems like the $750 coupon is popular and I know ever little bit helps but I would expect the dealership to be able to knock off $750 without a problem if I just ask.
It is starting to get confusing with MSRP, kickbacks (don't know if that is the correct term), rebates, dealer discounts, costco discount, etc.
What is a rebate?
What is a package discount?
How do these effect MSRP?
I always looked at the final out the door price. I never worried about what was actually a rebate or how much the dealer is discounting the price.
So say the MSRP on ford.com says $37500 for the model and options I want. Say invoice is $35000. Say I want the costco discount which say is $500 above invoice.
That brings the price to 35500. Then say I use the $750 coupon. Price is now $34750. Say then have $4000 in rebates. This brings the price to $30750. This is a bit higher than the price I would actually like to negotiate.
Couldn't I just find a dealer to sell a truck to me for a bit cheaper without worrying about the rebates and the costco price? At that point after negotiating, couldn't I just pop out the $750 coupon and get an overall lower price.
It seems like the $750 coupon is popular and I know ever little bit helps but I would expect the dealership to be able to knock off $750 without a problem if I just ask.
It is starting to get confusing with MSRP, kickbacks (don't know if that is the correct term), rebates, dealer discounts, costco discount, etc.
Five-0 Ret.
Joined: Mar 2011
Posts: 5,726
Likes: 675
From: Down South in Dixie
Can anyone explain to me in simple terms about pricing?
What is a rebate?
Rebates, and incentives are basically the same thing. These come from Ford. Most folks just figure them into the deal for a discount. Some can be used together, and some can't. That's a whole nuther story.
What is a package discount?
These are from Ford also. They bring the price of an option package down. They are subtracted from the MSRP on the window sticker.
How do these effect MSRP?
All lower the MSRP.
I always looked at the final out the door price. I never worried about what was actually a rebate or how much the dealer is discounting the price.
So say the MSRP on ford.com says $37500 for the model and options I want. Say invoice is $35000. Say I want the costco discount which say is $500 above invoice.
That brings the price to 35500. Then say I use the $750 coupon. Price is now $34750. Say then have $4000 in rebates. This brings the price to $30750. This is a bit higher than the price I would actually like to negotiate. Using these prices, you are at $6750 below MSRP. You have to remember that the dealer has to make a profit to stay in business. So in my mind you are at a good price at $30,750. Unless the dealer is willing to give up some of their holdbacks this may be the best you can do. I know some dealers show prices at $10,000 off sticker, but when you get to the lot you don't qualify for many of the rebates they subtracted. Sucks, but that's the way some do it.
Couldn't I just find a dealer to sell a truck to me for a bit cheaper without worrying about the rebates and the costco price? At that point after negotiating, couldn't I just pop out the $750 coupon and get an overall lower price. Shopping around is always a good idea. The last deal I made, I waited to spring the $750 after the negotiations.
It seems like the $750 coupon is popular and I know ever little bit helps but I would expect the dealership to be able to knock off $750 without a problem if I just ask. Not quite as easy as it sounds. The $750 coupon is from Ford. It's returned to the dealer after the sell. Most dealers, but not all, price as close to invoice as they can to make the sell.
It is starting to get confusing with MSRP, kickbacks (don't know if that is the correct term), rebates, dealer discounts, costco discount, etc.
What is a rebate?
Rebates, and incentives are basically the same thing. These come from Ford. Most folks just figure them into the deal for a discount. Some can be used together, and some can't. That's a whole nuther story.
What is a package discount?
These are from Ford also. They bring the price of an option package down. They are subtracted from the MSRP on the window sticker.
How do these effect MSRP?
All lower the MSRP.
I always looked at the final out the door price. I never worried about what was actually a rebate or how much the dealer is discounting the price.
So say the MSRP on ford.com says $37500 for the model and options I want. Say invoice is $35000. Say I want the costco discount which say is $500 above invoice.
That brings the price to 35500. Then say I use the $750 coupon. Price is now $34750. Say then have $4000 in rebates. This brings the price to $30750. This is a bit higher than the price I would actually like to negotiate. Using these prices, you are at $6750 below MSRP. You have to remember that the dealer has to make a profit to stay in business. So in my mind you are at a good price at $30,750. Unless the dealer is willing to give up some of their holdbacks this may be the best you can do. I know some dealers show prices at $10,000 off sticker, but when you get to the lot you don't qualify for many of the rebates they subtracted. Sucks, but that's the way some do it.
Couldn't I just find a dealer to sell a truck to me for a bit cheaper without worrying about the rebates and the costco price? At that point after negotiating, couldn't I just pop out the $750 coupon and get an overall lower price. Shopping around is always a good idea. The last deal I made, I waited to spring the $750 after the negotiations.
It seems like the $750 coupon is popular and I know ever little bit helps but I would expect the dealership to be able to knock off $750 without a problem if I just ask. Not quite as easy as it sounds. The $750 coupon is from Ford. It's returned to the dealer after the sell. Most dealers, but not all, price as close to invoice as they can to make the sell.
It is starting to get confusing with MSRP, kickbacks (don't know if that is the correct term), rebates, dealer discounts, costco discount, etc.
Member
Joined: Oct 2012
Posts: 95
Likes: 1
Costco Rocks
My Costco price is $1200 below invoice, which is about $3000 below MSRP. By the time I get rebates it's like $6000 off.
To explain you question MSRP is the normal retail. Some dealers charge more and explain that MSRP is suggested retail. Package discount is only if you have a nice package--just kidding. It is for a group of extras. Join Costco and let them get you a great deal, saving you thousands
To explain you question MSRP is the normal retail. Some dealers charge more and explain that MSRP is suggested retail. Package discount is only if you have a nice package--just kidding. It is for a group of extras. Join Costco and let them get you a great deal, saving you thousands
Can anyone explain to me in simple terms about pricing?
What is a rebate?
What is a package discount?
How do these effect MSRP?
I always looked at the final out the door price. I never worried about what was actually a rebate or how much the dealer is discounting the price.
So say the MSRP on ford.com says $37500 for the model and options I want. Say invoice is $35000. Say I want the costco discount which say is $500 above invoice.
That brings the price to 35500. Then say I use the $750 coupon. Price is now $34750. Say then have $4000 in rebates. This brings the price to $30750. This is a bit higher than the price I would actually like to negotiate.
Couldn't I just find a dealer to sell a truck to me for a bit cheaper without worrying about the rebates and the costco price? At that point after negotiating, couldn't I just pop out the $750 coupon and get an overall lower price.
It seems like the $750 coupon is popular and I know ever little bit helps but I would expect the dealership to be able to knock off $750 without a problem if I just ask.
It is starting to get confusing with MSRP, kickbacks (don't know if that is the correct term), rebates, dealer discounts, costco discount, etc.
What is a rebate?
What is a package discount?
How do these effect MSRP?
I always looked at the final out the door price. I never worried about what was actually a rebate or how much the dealer is discounting the price.
So say the MSRP on ford.com says $37500 for the model and options I want. Say invoice is $35000. Say I want the costco discount which say is $500 above invoice.
That brings the price to 35500. Then say I use the $750 coupon. Price is now $34750. Say then have $4000 in rebates. This brings the price to $30750. This is a bit higher than the price I would actually like to negotiate.
Couldn't I just find a dealer to sell a truck to me for a bit cheaper without worrying about the rebates and the costco price? At that point after negotiating, couldn't I just pop out the $750 coupon and get an overall lower price.
It seems like the $750 coupon is popular and I know ever little bit helps but I would expect the dealership to be able to knock off $750 without a problem if I just ask.
It is starting to get confusing with MSRP, kickbacks (don't know if that is the correct term), rebates, dealer discounts, costco discount, etc.
Member
Joined: Oct 2012
Posts: 95
Likes: 1
Costco is not the same deal everywhere
Costco will get you a great price and all of the rebates. Costco Pricing at Heller Ford, in Escondido, CA, is $1200 below invoice. I don't think you can negotiate that low. Costco did and most dealerships do not agree to Costco Pricing. The dealership next door to me, Perry Ford in Poway, CA agreed to the pricing and then refused. Their price is $900 below invoice and Majid, the liar, thought he would squeezed me when the truck came in, into a different deal. It is a ruthless business. Great truck, but not everyone is above-board.
What's weird to me is that I talked to the owner. Instead of telling them to honor the agreement, Perry Faulk is proposing to transfer my truck to his national city store to circumvent his employees. Oh well.
What's weird to me is that I talked to the owner. Instead of telling them to honor the agreement, Perry Faulk is proposing to transfer my truck to his national city store to circumvent his employees. Oh well.
Member
Joined: Dec 2012
Posts: 34
Likes: 2
MSRP IS suggest retail, that is what it stands for: Manufacturers Suggested Retail Price
Very rare or exotic models like a Shelby or the Ford GT can sell for well OVER the MSRP.
There is no such thing as "normal" retail. Many dealers sell at X plan or just above and are very forthcoming about it, others won't come off MSRP, especially on early runs of new model years. Any dealer can refuse to sell at whatever price they want, many won't sell special cars for X plan price for example.
Biggest thing with a package discount is that it is taken into account BEFORE the final MSRP is figured so it cannot be deducted again, say after your rebates. You can pretty much ignore them on vehicles that are on the lot--they are more for ordering a truck made to your specs.
As you said, all that matters is what the final price is, doesn't matter how they get to it. Doesn't hurt to know what rebates are available for your area to know they applied all of them. Use Ford's rebate site to figure out what is available for your zip.
http://www.ford.com/incentives/
Very rare or exotic models like a Shelby or the Ford GT can sell for well OVER the MSRP.
There is no such thing as "normal" retail. Many dealers sell at X plan or just above and are very forthcoming about it, others won't come off MSRP, especially on early runs of new model years. Any dealer can refuse to sell at whatever price they want, many won't sell special cars for X plan price for example.
Biggest thing with a package discount is that it is taken into account BEFORE the final MSRP is figured so it cannot be deducted again, say after your rebates. You can pretty much ignore them on vehicles that are on the lot--they are more for ordering a truck made to your specs.
As you said, all that matters is what the final price is, doesn't matter how they get to it. Doesn't hurt to know what rebates are available for your area to know they applied all of them. Use Ford's rebate site to figure out what is available for your zip.
http://www.ford.com/incentives/
Senior Member
Joined: Jul 2011
Posts: 606
Likes: 37
From: Texas
Just bought a 2013. The dealer priced it at invoice minus rebates. I did financing on my own, so they had to raise the price by $1,000. Buit the $750 coupon come in handy, because that is not figured into the dealer price until you tell them about it. Every dealer is different. I tried to trade locally, and had 2 dealers tell me they could not match the deal that was offered 2 hours away. Do some internet shopping, they usually have their lowest prices on line.
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Member
Joined: Oct 2008
Posts: 57
Likes: 2
From: Westminster, CO
With all the talk about rebates and discounts, keep in mind what is pre tax and what is post tax.
You and the dealer will agree on some price, then they'll add on their fees and deduct your trade in (if applicable) to get the taxable value of the sale. Then add in sales tax, title, and license. The rebates/incentives, coupons, and down payment are then applied after taxes to get your OTD price.
Agreed Price + Dealer Fees - Trade Value + TTL - Available Rebates - Down Payment = OTD Price
You and the dealer will agree on some price, then they'll add on their fees and deduct your trade in (if applicable) to get the taxable value of the sale. Then add in sales tax, title, and license. The rebates/incentives, coupons, and down payment are then applied after taxes to get your OTD price.
Agreed Price + Dealer Fees - Trade Value + TTL - Available Rebates - Down Payment = OTD Price
Member
Joined: Oct 2012
Posts: 95
Likes: 1
Tax on net costs not on rebate.
With all the talk about rebates and discounts, keep in mind what is pre tax and what is post tax.
You and the dealer will agree on some price, then they'll add on their fees and deduct your trade in (if applicable) to get the taxable value of the sale. Then add in sales tax, title, and license. The rebates/incentives, coupons, and down payment are then applied after taxes to get your OTD price.
Agreed Price + Dealer Fees - Trade Value + TTL - Available Rebates - Down Payment = OTD Price
You and the dealer will agree on some price, then they'll add on their fees and deduct your trade in (if applicable) to get the taxable value of the sale. Then add in sales tax, title, and license. The rebates/incentives, coupons, and down payment are then applied after taxes to get your OTD price.
Agreed Price + Dealer Fees - Trade Value + TTL - Available Rebates - Down Payment = OTD Price
The taxes are the least of the issues. I will say this if you have a $1000 plus to throw away, trade in your vehicle. Please e-mail me. I will give you my address to send any other money that you have no use for as well. I am wondering this. Why does our Government tax us on the price, prior to the rebate. Why not tax on what the vehicle costs?
Think about it. Your vehicle costs two million. Don't worry. We are going to rebate you all but thirty thousand under a new program, but you still have to pay $180,000 in taxes. Whether it is $300 or not, why?