| For the most part if you've done any research on car | | | | have researched and subtract the holdback from that |
| buying and have researched the car that you are | | | | number. |
| looking to buy, then you have a pretty good idea of | | | | Keep in mind however that for car dealers holdback is |
| what the invoice cost on the car is. | | | | somewhat of a sacred cow. Meaning that they |
| The vast majority of people that buy cars think that | | | | consider that holdback money their money and |
| dealer invoice is what the dealer pays for their cars. | | | | nobody else's. And most dealers don't consider the |
| However, there are other factors that go into exactly | | | | holdback money as being negotiable as part of putting |
| what the dealer has to pay for their cars. | | | | the deal together. But, having said that, you should |
| The first factor is one that is called holdback. Holdback | | | | know that when it comes to putting the deal together |
| is simply a small amount of money (usually 2% to 3%) | | | | everything is negotiable. |
| of the suggested retail price minus any shipping | | | | Holdback actually started many years ago as a way |
| charges which is held back by the manufacturer. | | | | for the manufacturers to help ensure that the dealers |
| Usually the dealer gets this money back every quarter | | | | had money every quarter to pay such things as |
| based on each of the cars they have sold during that | | | | revenue taxes that would come due as a part of |
| time. | | | | doing business. Today however, holdback has turned |
| Let's say for example that a car on a dealer's lot has | | | | into a pretty decent profit center for the car dealers |
| a MSRP of $20,000. If the manufacturer of that | | | | on each of their units. |
| vehicle as a 3% holdback, then the actual cash held | | | | So, keep in mind that even though getting at the |
| back on the vehicle would be $600. keep in mind that | | | | dealers holdback may be somewhat difficult; keep in |
| the amount of holdback varies from manufacturer to | | | | mind with a little hard work and the right timing you |
| manufacturer. | | | | could shave off a few hundred more dollars off of |
| So to get even closer to the dealer invoice cost of a | | | | what you'll pay for your next car. |
| car, you will want to take the invoice price that you | | | | |