Buying a Car - A Consolidated Research Guide

I am in the market for a Nissan 350Z (Read my original post). I know I have to pay a premium for a sports car, but I'm NOT willing to pay a cent more than necessary. This caused me to search the web for some information.

From what I gathered, there are 3 price points to any car purchase:

1. Manufacturer Suggested Retail Price (MSRP) - a price made up by the manufacturer for the car, based loosely on its real cost
2. Invoice Price - the price the dealer pays to get the car
3. Net Price - the price the dealer actually pays after taking any incentives from the manufacturer, such as holdbacks, sales incentives, financing incentives, etc.

So to give an example from my own life, I contacted two dealers for the specific 350Z I wanted. I knew MSRP was $36,500.

They immediately quoted me a price of $34,000, with the suggestion that $33,000-$33,500 was their invoice price. The difference from price point (1) and (2) was 8%.

Next, I considered the holdbacks for Nissan (a complete list of manufacturer holdbacks can be found here). Its about 3%. However, since the holdback is pure profit when you special order a car, I had to recalculate their invoice point.

I also figured in sales incentives and bumped MSRP to Invoice as actually 10%.

This provided me a net price of $31,864.50. Armed with this number, I will be going into negotiations next week to see if my calculations hold out.