What do owner transaction price and manufacturer suggested retail price mean?
2 Answers
Owner transaction price refers to the actual amount you pay for the car after repeated negotiations with the dealer. Manufacturer suggested retail price (MSRP) is the selling price recommended by the manufacturer to consumers. Due to the application of value-added tax, consumption tax, and tariffs, some dealers convert ex-tax prices into tax-included prices, artificially inflating profits and leading to abnormally high prices. To curb this phenomenon, manufacturers provide a reference selling price after considering various factors, known as the MSRP. The analysis of car purchase prices is as follows: 1. New cars. For newly launched models, dealers are in no hurry to sell, and since these cars are highly anticipated, there are usually no discounts. In fact, popular models may even see significant price markups. 2. Cars on the market for 1-2 years. Most models will drop their premium status after being on the market for a year, and dealers will offer small discounts to boost sales. 3. Cars on the market for 3-5 years. The design and performance of these cars are no longer selling points, so manufacturers can only rely on lower prices to create an advantage. Generally, models on the market for 3-5 years have discounts of at least 15%-20% off the MSRP, with even higher discounts for models with poor sales.
The manufacturer's suggested retail price (MSRP) is like the car company's recommended price tag, indicating how much the vehicle should officially sell for. However, this price is just a starting point, and dealerships may adjust it. The actual transaction price is the amount you ultimately pay, typically negotiated through bargaining, promotions, or added services. When I last bought a car, I remember an SUV with an MSRP of 250,000 yuan, but thanks to a dealership promotion and my persistent haggling, I drove it away for just 225,000 yuan. The 25,000 yuan saved could be used for other things, like adding insurance or buying accessories. When purchasing a car, it's wise to compare offers from multiple dealerships and even check historical transaction data using apps—don’t be intimidated by the MSRP, as the final payment may also include taxes and additional fees. Always calculate the total cost to stay within budget.
