invoice price is a very solid number on paper, just a matter of whether you can get the number or not.

 

I think it is how bad they want to sell the car.

 

Invoice doesn't really mean that much anymore as that is nowhere near what the dealer actually paid. I just bought a 2010 RX at $200 under invoice, but the dealer still made $2,500 -$3,000 on the deal because of holdbacks and Lexus incentives to him. Truecar.com has a pretty good database that will explain all of it and lets you know exactly what the dealers cost is. Once you know that number start negotiating. Just shooting for invoice won't usually get you the best deal.

 

this is true, but in the OPs case, a few hundred around invoice on a 2011 is probably close to the truecar.com price.

 

correct, for 2011 there is no incentive. dealer holdback really doesn't have much to do with customers, it's their profit to make most of the time unless they really want to get rid of a car. i still think invoice is a very important measure, but it's not the only information one needs

 

Invoice is not a true measure because there are items on the invoice that's misleading
All Lexus invoice here in CA has a 2% dealer holdback & 1% wholesale financial reserve on it

dealer holdback is the amount Lexus will pay the dealer once the card is sold
so if you buy the car at invoice, dealer actually make double shares on the dealer holdback
(one share from Lexus to dealer and another share from you to dealer)

wholesale financial reserve is what Lexus will pay the dealer to offset the interest charge dealer have to pay Lexus
(dealer don't buy inventories w/ cash but w/ their line of credit w/ Lexus so they have to pay interest to Lexus)
it is the same logic as dealer holdback, if you buy at invoice, you essentially are giving dealer double share on WFR too..

So the actual starting point in my opinion, should have been invoice price - dealer holdback - wholesale financial reserve
if dealer is eagar to move the car, they will then throw in some of their actual dealer holdback to sweeten the deal

Here in CA, I was quoted $1k under invoice for a 2011 AWD but decided to go w/ 2010 AWD for $3k under invoice.
I went with 2010 b/c of the incentive and I know I will keep the car for quite a few yrs so I was not worried about resale value

 

that's "manufacturer's suggested retail price" which in reality means... NOTHING.

beyond whatever 'price' they have for the vehicle, even let's say starting with MSRP, they may have added in sales tax, tags, dealer prep, a doc fee, and possibly some B.S. 'dealer packages' like 'rust proofing' (worthless), or some maintenance plan, etc.

i bought at msrp ONCE, when i was young and dumb. after that, i've worked from INVOICE price, sometimes around invoice, sometimes quite a bit higher, but still way below MSRP.

glws.

 

that's some great info, thanks.

 

Does anyone have any idea of invoice and holdback etc. in Ontario Canada? I am about to negotiate the purchase of a RX 450h and would love to have this type of info. For those in Canada, I'd like to get a 2011 model with the Ultrapremium package 1.

 

go to Truecar.com and see what the price is there for this Ultrapremium package 1 which we do not get here in the US.

 

pick our 450h up on Saturday paid 500 over invoice for a special ordered MSRP was just short of 63k USD paid 55k so again is the car on the lot you can get a good price if they need to sell units and at the end of the month is always a good time to get a car.

 

I don't think truecar.com applies in Canada. Just looking at their website it would appear only useful for Americans and not Canadians.

 

You forgot about Dealers Advertising costs or TDA (Toyota/Lexus) - this is a real cost to dealers charged by corporate. All these 'december to remember' TV spots are not cheap and the costs are passed on to dealers. The TDA on my 450h was $500, so I factored that into the equation along with holdback and pack (WFR).

At the end of the day, as long as I get the model I want w/the equipment I want in the color I want, a few extra bucks will not kill the deal - I plan on keeping this one for awhile, so I do not have to squeeze every possible $ out of the deal . . .

 

It is possible. I know someone that recently bought one @ $1300 under on a FWD model. Another dealer offered $500 under.

 

on 2011? already?