Some new car buyers across the country are dealing with MSRP markups because of the low inventory issues across the country. These issues have led to a supply and demand imbalance in the automobile industry, and some dealerships opt to take advantage of the situation.
The bulk of the inventory issues goes back to the semiconductor squeeze due to the COVID-19 pandemic. Manufacturers face challenges in meeting demand, turning the automobile industry into a seller’s market—hence, leading to MSRP markups.
At Sierra Blanca Motors, we don’t believe in making life harder for potential car owners looking to buy their dream vehicle. Our sales representatives will always offer a fair deal to our customers on every purchase. Book an appointment today to find the best deal on a new vehicle.
How Does a Car’s MSRP Price Compare to What You Will Pay?
The Manufacturer’s Suggested Retail Price (MSRP) refers to the price a car manufacturer has set as the ideal cost of the car. It’s the advertised sum you’re likely to find in reviews and commercials. However, the keyword to note in the MSRP definition is “suggested.”
The dealership doesn’t have to sell at that exact price, and you also don’t have to pay that sum when buying the car.
Before the MSRP markups, prospective buyers often received a quote below the MSRP for most vehicles. As a result, cars in demand sold closer to this recommended price, while those with lower demand rarely hit the MSRP value.
Today, many dealerships now quote a “market-adjusted value” (another way of saying MSRP markup) for special-edition and limited-production vehicles. You may also get the markup for standard trims on popular vehicles hot in demand.
Some dealerships may offer a deal below the MSRP but use dealer-installed options or tricky car financing deals to bump the final price back above the value, eroding any discounts you might secure.
So the MSRP is almost always different from what you’ll pay as the final cost of your vehicle. Whether you get a discount or end up paying above the rate comes down to several factors, including your negotiation skills. You also have to factor in extras such as sales tax and registration fees in your final calculations. These are often not included in quoted prices above or under MSRP.
What You Need To Know About MSRP Markups
Are you a prospective car buyer perplexed by the MSRP markups by dealerships? Let’s review a few ways you can get a good deal:
- Get informed. You need to know the car’s MSRP and “True Market Value.” You can find the numbers with a quick search online. With the right numbers, it becomes harder to fall for excessive markups.
- Avoid trick pricing. Dealerships that practice trick pricing may call you back to refinance a purchase or include too many unnecessary add-ons to your final price. Stay grounded, and be sure to close the deal before leaving the dealership.
- Compare quotes across multiple dealerships. Shopping around makes a fantastic option to get the best deals. Travel to dealerships far outside your area if necessary.
- Avoid getting emotional. You have to accept the reality of the supply and demand imbalance and brace yourself for negotiations. Don’t get angry at quoted prices or show desperation to own a specific car. Buyers willing to walk away are unlikely to pay outrageous markups.
Expect a Fair Deal & Exceptional Service at Sierra Blanca Motors
As the world slowly recovers from the COVID-19 pandemic, we may remain in the seller’s market for quite a while. Dealerships do not feel compelled to sell at the MSRP, so many of them will continue to push their profit margins on single deals even higher. You can avoid becoming a victim by implementing some of the tips covered above and choosing a dealership that puts you first.
Sierra Blanca Motors is a customer-centric dealership in Ruidoso, NM. The inventory crunch hasn’t stopped us from helping customers secure great deals on their dream vehicles. We treat our customers like family, so we don’t risk our relationship with unnecessary MSRP markups. Our customers come from Ruidoso and nearby areas such as Alamogordo, Las Cruces, Roswell, and more.
Are you looking to buy a new Chrysler, Dodge, Jeep, RAM, or Chevrolet vehicle? Contact us today at (575) 315-9861 to book an appointment.
