Destination fees—those non-negotiable charges tacked onto new car purchases—are rising faster than inflation, adding unexpected costs for buyers. Here’s what you need to know about these fees and how to navigate them:

What Are Destination Fees?

• Definition: Fees that cover the cost of delivering a car from the factory or port to the dealership.
• Placement: Often listed as "destination" or "inland freight and handling" charges, typically hidden in fine print on window stickers or automaker websites.
• Non-Negotiable: Buyers can’t opt out of these fees, unlike optional features like upgraded sound systems or leather seats.

Key Findings

Fee Inflation:
- Average fees rose from $839 in 2011 to $1,244 in 2020—more than 2.5x the rate of inflation.
- Some brands, like Stellantis (formerly Fiat Chrysler), increased fees by up to 114% for certain models.

Top Offenders:
- 2021 Ford F-150: $1,695 destination fee.
- Jeep Cherokee: Jumped from $995 in 2016 to $1,495 in 2019.

Least Affected:
- Luxury brands like Audi, BMW, Lexus, and Mercedes-Benz increased fees by less than 20%, keeping pace with inflation.

Why Are Fees So High?

• Automakers claim increased shipping costs and logistics challenges, including:
• A shift to larger vehicles (SUVs and trucks).
• Fewer vehicles per carrier, raising transport costs.
• Consumer advocates argue these fees are a profit-padding tool, allowing manufacturers to raise revenue without increasing the sticker price.

Issues With Transparency

• Opaque Pricing: Automakers don’t clearly disclose what the fees cover or how they’re calculated.
• Lack of Accountability: Manufacturers are vague about whether fees actually reflect delivery costs.
• Consumer Misunderstanding: Buyers often don’t realize these fees aren’t optional, unlike optional features.

How to Navigate Destination Fees

Know the Fees:
- Look for the last line item on the car’s window sticker, just above the "total MSRP."
- Fees may not be included in online or advertised prices—check the fine print.

Compare Models Carefully:
- Ensure price comparisons include destination fees and other charges for an accurate assessment.

Negotiate Smartly:
- Focus on the out-the-door price (total cost, including fees and taxes) rather than debating delivery fees directly.
- Haggle for a lower overall price to offset fees—dealers expect negotiation.

Advocacy

• Transparency Call: CR is urging automakers to include destination fees in advertised prices to help consumers make informed decisions.
• Fee Disclosure: CR highlights destination fees in its car reviews to ensure buyers are aware of total costs upfront.

Bottom Line

Destination fees are unavoidable, but understanding them and negotiating effectively can help you save money on your next car purchase.

Next: Read 2500+ consumer guides to shopping, electronics, appliances, home services, cars, money and more.

❤ If you liked all this, consider supporting us by checking out Tiny Skills - 250+ Top Work & Personal Skills Made Easy