# MSRP and new vehicle prices

**URL:** <https://boards.straightdope.com/t/msrp-and-new-vehicle-prices/964220>\
**Category:** Factual Questions\
**Created:** [May 10, 2022, 2:54am UTC](https://boards.straightdope.com/t/msrp-and-new-vehicle-prices/964220 "2022-05-10T02:54:06Z")\
**Posts on this page:** 4\
**Page:** 2

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**Author:** ![Great\_Antibob](https://avatars.discourse-cdn.com/v4/letter/g/e47c2d/32.png) [@Great\_Antibob](https://boards.straightdope.com/u/Great_Antibob)\
**Post date:** [May 10, 2022, 10:15pm UTC](https://boards.straightdope.com/t/msrp-and-new-vehicle-prices/964220/21 "2022-05-10T22:15:59Z")

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> [@md-2000](#):
>
> As for selling through a dealer but charging a fixed price - dealers see the writing on the wall, what’s their angle against others if they can’t hedge on price? Plus, who sets the commission for the dealer?

There’s the financing side to complete the dealer trifecta (price, financing, service), but these days even that is tricky with the many at-our-fingertips options to research financing.

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**Author:** ![lobotomyboy63](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lobotomyboy63/32/2900_2.png) [@lobotomyboy63](https://boards.straightdope.com/u/lobotomyboy63)\
**Post date:** [May 10, 2022, 10:36pm UTC](https://boards.straightdope.com/t/msrp-and-new-vehicle-prices/964220/22 "2022-05-10T22:36:58Z")

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I’m curious to know how inflated prices affect a couple other things…

Let’s suppose I’m looking at a Ford with a $30K MSRP. The dealer adds a market adjustment of $10K, meaning the car will cost $40K.

1. Are lenders happy to work with that $40K number? The borrower will be more upside-down than usual if s/he stops paying the loan.

2. Are insurers happy to work with that $40K number? If I buy mine for $40K and you wait a year…you get yours for $30K. If I have an accident, when is mine “totalled” —is it to be based on a $40K or $30K value? OTOH if it becomes wildly popular and the MSRP shoots up past $40K, which figure does insurance use?

I guess reading the fine print is suddenly more important.

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**Author:** ![obbn](https://avatars.discourse-cdn.com/v4/letter/o/d6d6ee/32.png) [@obbn](https://boards.straightdope.com/u/obbn)\
**Post date:** [May 11, 2022, 12:51am UTC](https://boards.straightdope.com/t/msrp-and-new-vehicle-prices/964220/23 "2022-05-11T00:51:16Z")

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What you paid for a vehicle has zero to do with what insurance will pay if it’s totaled. Insurance will pay “replacement value”, getting similar used car values to base what it’ll give you.

Now, there is GAP insurance available to cover the difference between the totaled value of the car and what you owe. But that’s usually an ad on to basic insurance.

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**Author:** ![lobotomyboy63](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lobotomyboy63/32/2900_2.png) [@lobotomyboy63](https://boards.straightdope.com/u/lobotomyboy63)\
**Post date:** [May 11, 2022, 1:23am UTC](https://boards.straightdope.com/t/msrp-and-new-vehicle-prices/964220/24 "2022-05-11T01:23:04Z")

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> [@obbn](#):
>
> What you paid for a vehicle has zero to do with what insurance will pay if it’s totaled.

Here’s KBB with a listing of 2019 F150 trucks. I see one going for under $22K. I also see one going for almost $80K. Are you saying that they were the same price when they were new or that the insurance will pay out the same if they’re both totaled?

> **[How Do Insurance Companies Decide to Total a Car in Texas?](https://milanoaccidentlawyers.com/how-do-insurance-companies-decide-to-total-a-car-in-texas/)**
>
> Learn how do insurance companies decide to total a car in Texas after a car accident and how knowing this formula will help you in your car accident case.

> [@obbn](#):
>
> Insurance will pay “replacement value”, getting similar used car values to base what it’ll give you.

And used car values include how expensive the trim line was, which options were included, whether it was 4x4, and other things that drive the price up…and therefore the replacement value is higher.

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