Out-the-Door Price vs. MSRP vs. Invoice: What Each Car Price Means

Short answer: MSRP is the manufacturer's suggested retail price on the window sticker. Invoice is what the manufacturer charges the dealer, before the rebates and incentives the dealer may get. The out-the-door (OTD) price is the total you actually pay before financing, with dealer fees, add-ons, taxes, and title and registration included. MSRP and invoice are reference points. The OTD price is the number to get in writing and compare.

The car prices compared

These definitions follow the FTC's "Know Your Prices" glossary and federal window-sticker law.

MSRP: the window sticker price

Federal law, the Automobile Information Disclosure Act, requires manufacturers to put a label on every new car's window before it reaches the dealer. Among other things, the label must show the manufacturer's suggested retail price, the suggested price of each factory-installed option, the transportation charge to the dealer, and the total of those amounts. This is often called the Monroney sticker. Federal law also prohibits willfully removing or altering it before the car is delivered to the buyer.

The key word is "suggested." MSRP doesn't include dealer fees, taxes, or registration, and it isn't the price you're required to pay. The FTC's staff report on car buying found that some buyers paid sticker price without negotiating because they believed the price was fixed. The CFPB lists the vehicle price, along with loan terms and add-ons, among the things you may be able to negotiate.

Dealer sticker: the second label

Some cars carry a second sticker next to the factory one. The FTC describes the dealer sticker price as the Monroney sticker price plus dealer-installed options, additional dealer markup or profit, dealer preparation, and pre-installed add-ons such as undercoating. Those extra lines come from the dealer, not the manufacturer. FTC staff guidance says dealers can't suggest an add-on is required when it's optional, or charge for options you didn't agree to. See which dealer add-ons you can refuse.

Invoice price: what the dealer is billed

The FTC defines the invoice price as the amount the manufacturer charges the dealer for the vehicle, before any rebates, allowances, discounts, and incentives the dealer receives. That last part matters. The Minnesota Attorney General's car handbook notes that "holdbacks" and other credits from the manufacturer almost always reduce the dealer's true cost below the invoice amount, so a car sold "at invoice" isn't necessarily sold at cost.

Invoice figures are useful for context when you size up an offer. But a dealer's quote above or below invoice tells you less than the total you'll pay. Two dealers can quote the same vehicle price and still end up far apart once fees and add-ons are added.

Advertised price: what the FTC says it must include

In its pricing FAQs for the auto industry, FTC staff say the advertised price must be the actual price any consumer can walk in and pay. If the dealer requires a fee, that fee belongs in the advertised price. Dealers may leave out charges a government requires the buyer to pay, such as taxes. The FTC's own example: if a dealer advertising a $40,000 vehicle would charge any buyer an $85 document fee, the advertised price must be $40,085. Ads can also show MSRP, but only if the actual price is the most prominent amount. These FAQs reflect FTC staff views and aren't binding, and state rules on fees also apply, so always ask for the itemized total.

Out-the-door price: the number that matters

The FTC defines the out-the-door price as the total price, before financing, including options, taxes, DMV fees, and the documentation fee. Its consumer advice is to ask the dealer to send the out-the-door price in writing before you leave home, and to confirm the car is actually on the lot. A written OTD price lets you compare offers on an apples-to-apples basis, remove unwanted add-ons, and spot last-minute charges.

An itemized OTD quote usually shows these lines (amounts vary by dealer and state):

Planning a trade-in? The FTC suggests getting the OTD price for the car you want first, even if the dealer can't yet confirm your trade-in value. See how to negotiate the trade-in separately.

Total sale price: the number if you finance

If you finance, the Truth in Lending disclosure shows a total sale price: everything you'll pay, including your down payment and finance charges. The FTC report illustrates why the monthly payment alone can mislead. In its example chart, a $500 monthly payment could mean a $35,000 cash price over 72 payments at 4.5% APR, for a total sale price of $39,500. Or it could mean a $20,500 cash price over 36 payments at 6.1% APR, for a total sale price of $22,100. The FTC also suggests settling the out-the-door price before discussing financing. Read whether the dealer's interest rate is negotiable before you get to the finance office.

Which number should you negotiate?

1. Use MSRP and invoice as context, not targets. They describe the car, not your deal.
2. Ask several dealers for an itemized OTD price in writing for the same vehicle (stock number or VIN).
3. Compare the OTD totals, then question any dealer fee or add-on you didn't ask for.
4. Settle the OTD price before financing, and keep the trade-in as its own line.
5. At signing, match the contract to the written quote. The FTC advises asking to see how the purchase price and terms match what the dealer sent you, and walking away if they don't.

A short email to send:

Hi, I'm interested in the [Year Make Model Trim], stock #[number]. Could you send your out-the-door price in writing, itemized: selling price, each dealer fee, any add-ons, taxes, and title and registration? Please also confirm the car is on the lot. I'm comparing totals from a few dealers. Thanks, [First name]

For more wording, see how to get an out-the-door price by email, and run any quote through our free OTD calculator.

FAQ

Is the out-the-door price the same as MSRP?

No. MSRP is the manufacturer's suggested retail price for the car and its factory options, plus the destination charge, as shown on the window sticker. The out-the-door price is the total you pay before financing: the selling price plus dealer fees, any add-ons, taxes, and title and registration, minus any trade-in.

What is the invoice price of a car?

The FTC describes the invoice price as the amount the manufacturer charges the dealer for the vehicle, before any rebates, allowances, discounts, and incentives the dealer receives. Because of holdbacks and other manufacturer credits, the dealer's true cost is often below invoice, so "at invoice" doesn't mean "at cost."

Can you buy a car for less than MSRP or invoice?

Sometimes. MSRP is a suggested price, not a required one, and both the vehicle price and loan terms can be negotiated. Whether a dealer will go below MSRP or invoice depends on the model, demand, and incentives. Compare written out-the-door quotes from several dealers to see what's actually available.

Does the advertised price have to include the doc fee?

According to FTC staff guidance, a dealer's advertised price must include every fee the dealer requires, including a mandatory documentation fee. Dealers may leave out charges a government requires you to pay, such as taxes. State rules on doc fees vary, so read the itemized quote.

What's the difference between the out-the-door price and the total sale price?

The out-the-door price is the total before financing. The total sale price, shown on the Truth in Lending disclosure when you finance, adds your down payment and the finance charges. Two loans with the same monthly payment can have very different total sale prices.

Updated October 21, 2026