Saturday, September 7, 2013

Chris decided to buy a new automobile and gathered information about the purchase price.The manufacturer's website show a "list price" of $50,000...

The list prices given out by manufacturers are frequently the retail price recommended by the companies, but dealers or retailers are usually free to offer some discount over the list price. It is not common for dealers to for dealers to charge prices more than the list prices unless the additional prices are charged on account of services or accessories provided which are not covered by the list price.


The wide variation in prices ($30,000 to $60,000) reported in Blue Book, is most likely to be due to the dealer discount as well as variations in list prices itself from time to time. For Chris, both the list price and blue Book prices are important in for comparing prices of different models of cars and the likely range of negotiation in finally purchasing a car. But information from these two sources is not sufficient for making a purchase decision. Chris must obtain firm quotation one or more dealers to find out the maximum price he may be charged. After that, if required, he can try to negotiate the prices down.

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