How to Find Out How Much a Dealer Pays for a Car

Many new car buyers believe they are getting a great deal if they buy an auto at the invoice price. They mistakenly think that the invoice price represents what the dealership pays the manufacturer for the car. In reality, the invoice is only one piece of the information you need to tally the dealer's true cost. You must also know about holdbacks and special incentives, both of which can drastically reduce what the dealer actually pays.

Instructions

1

Calculate the current invoice price of the car by looking it up on at least two automotive research websites. Truecar.com, Edmunds.com and KBB.com are all solid research websites. If two of the sites come up with a different invoice total for the same vehicle with the same options, there may have been a price increase in the last year that one of the websites hasn't picked up yet. Use a third site to double check the figures.

2

Calculate the holdback amount, which Edmunds.com explains will be a percentage of either the invoice cost or the manufacturers suggested retail price, and subtract it from the invoice total. The holdback is money passed on by the manufacturer to the dealership, which adds additional profit to the sale. This amount differs among different automakers but you can find holdback percentages on the car research sites.

3

Subtract all current factory to dealership incentives from your current total. These incentives are similar to rebates, but they are not publicly advertised and go directly to the dealership instead of being given to consumers. They change frequently, according to Autoadvice.com, but the most recent incentives for each make and model should show up on research sites.