Car buyers paid more than $26 billion in ‘destination charges’ last year

[Biker16]

The Obscure Fee Costing You More to Buy a Car
Car buyers paid more than $26 billion in ‘destination charges’ last year

 

Quote

Consumers are encountering a new kind of sticker shock when buying a car. It is called the “destination charge” and is now running an average $1,600. The charge is supposed to cover the cost of shipping a new car or truck to its buyer. Automakers have been upping the fee by hundreds of dollars in recent years, as fuel and shipping costs have risen. Now higher tariff fees are likely contributing to the increases, car dealers and analysts say.

 

 

[tbone]

I think this has become a hidden profit center for Ford and is excessive. It certainly didn’t cost $1700 to ship our Explorer that we recently got from Chicago to our dealer. I understand they are average costing it for CONUS, but even privately shipping a vehicle doesn’t cost that much. Another way to lower the MSRP without actually lowering it. 

[Motorpsychology]

On 3/2/2026 at 1:13 PM, Biker16 said:

The Obscure Fee Costing You More to Buy a Car
Car buyers paid more than $26 billion in ‘destination charges’ last year

 

 

 

It is called Destination and Delivery. The Delivery takes about 2-3 hours depending on the vehicle- add time for dlr installed accessories, but those charges are usually included in the cost of the accessory(s).

 

Another profit center is the "Document Fee." Stuck on to every new vehicle in the lot. My Dealer charges $475.😳 When I was selling in the mid-80s-90s It was $25-50. 

[akirby]

1 hour ago, Motorpsychology said:

It is called Destination and Delivery. The Delivery takes about 2-3 hours depending on the vehicle- add time for dlr installed accessories, but those charges are usually included in the cost of the accessory(s).

 

Another profit center is the "Document Fee." Stuck on to every new vehicle in the lot. My Dealer charges $475.😳 When I was selling in the mid-80s-90s It was $25-50. 

I've seen $900 doc fees on Toyotas.  It's ridiculous.

[blazerdude20]

44 minutes ago, akirby said:

I've seen $900 doc fees on Toyotas.  It's ridiculous.

Unfortunately until states or the fed start to regulate it, it will be nearly impossible to have consistent fees and paperwork. No chance the dealer lobbies don’t prevent that. 

[tbone]

5 hours ago, Motorpsychology said:

It is called Destination and Delivery. The Delivery takes about 2-3 hours depending on the vehicle- add time for dlr installed accessories, but those charges are usually included in the cost of the accessory(s).

 

Another profit center is the "Document Fee." Stuck on to every new vehicle in the lot. My Dealer charges $475.😳 When I was selling in the mid-80s-90s It was $25-50. 

Yes, I’m aware regarding delivery.  I’m thankful I do not to deal with those ridiculous fees with my dealer.

[fordmantpw]

My dealer tries to add the fees on.  I just say that I'm not paying it.  Then we argue, they complain about not making any money, I threaten to walk, they so "OK, but state law says we have to charge at least $49" and I say "no it doesn't, but I'm not going to argue over $49 on a huge purchase, let's get this over with so I can get away from you slimy bastards."  Or something like that anyway...

[akirby]

2 hours ago, fordmantpw said:

My dealer tries to add the fees on.  I just say that I'm not paying it.  Then we argue, they complain about not making any money, I threaten to walk, they so "OK, but state law says we have to charge at least $49" and I say "no it doesn't, but I'm not going to argue over $49 on a huge purchase, let's get this over with so I can get away from you slimy bastards."  Or something like that anyway...

That's why I loved X plan.  Not only was there no haggling on price the doc fee was limited to $100 and the dealer could not keep incentives or dealer cash.

[BenKohnen]

Dealership perspective here.

OK, destination & delivery fee is part of the new vehicle window sticker. That one is part of how the manufacturers are managing MSRP without "moving the vehicle price". I just went back through some of the pricing guides, because the F-150 was on my mind recently. A couple samples:

2016: $1195

2018: $1495

2020: $1695

2024: $1995

2025: $2595

2026: $2595

The other fee in discussion is the "Dealer Service Fee", also known as "Document Fee", "Doc Fee" or "BS I'm Not Paying That Take It Off There Fee". In some states it's regulated, so when the state says "a dealer's document fee cannot exceed $999", the dealers will set their Doc Fee at $999. I keep an eye on other dealer's Doc Fees near me. Ours is $299. Most are $349, some are as much as $499. That money isn't just a profit center, it helps absorb some of the fees and expenses every dealer would otherwise just absorb. All the forms we're required to use (and purchase) cost the dealership. There's access and maintenance fees to connect to the state title and registration systems. It's obscene what it costs to operate even a small dealership. Until some of that became part of my department's budget/expense, I had no idea. On the sales floor, I thought the Doc Fee was just something that was added to pad the boss' pocket. Our $299 doesn't cover the expense per car of doing the unshown business.

Now, that said, there's the addendum things, what the dealer would call "hard adds". Paint and fabric protection packages already applied to the vehicle - that one's pretty common on something sitting in the showroom, or a Courtesy Transport vehicle. Nitrogen filled tires. Wheel lock kits on every vehicle. Passive anti-theft, or "etch". Window tint already applied - I think I saw that on a southern vehicle as a "climate package". Those are more on the shady side, big-time profit centers that are supposed to be optional. If the dealer has already added it to the vehicle, they're not likely to take it off. If they somehow do, you've spent your negotiation capital on getting that taken off.

[fordmantpw]

When you agree to the price of the car, that should include the doc fees.  I understand you have the cost of doing business, but include that in the car price.  Don't hit me with it later.  I always ask "is that the out the door price" when negotiating.  Then I'm covered on "you didn't say anything about doc fees" when we get ready to sign the paperwork.

 

I run a software consulting business.  I have to pay for my server, my invoicing system, my email, my domain name, etc.  Should I just tack on a fee to every invoice and call it "cost of doing business with you" fee?  No, I roll that into my rates.  It's BS, and it's just another reason dealerships are, for the most part, sleezy and why I would buy directly from Ford if I could.

 

No offense to you, of course.

[BenKohnen]

3 minutes ago, fordmantpw said:

When you agree to the price of the car, that should include the doc fees.  I understand you have the cost of doing business, but include that in the car price.  Don't hit me with it later.  I always ask "is that the out the door price" when negotiating.  Then I'm covered on "you didn't say anything about doc fees" when we get ready to sign the paperwork.

 

I run a software consulting business.  I have to pay for my server, my invoicing system, my email, my domain name, etc.  Should I just tack on a fee to every invoice and call it "cost of doing business with you" fee?  No, I roll that into my rates.  It's BS, and it's just another reason dealerships are, for the most part, sleezy and why I would buy directly from Ford if I could.

 

No offense to you, of course.

 

No offense taken... been in this line of work long enough that I don't get offended by much.  I work for a very up-front dealership... but there's been a couple forays into the other side. They were very brief for me, I couldn't do some of what was required at those stores.

 

The CARS law that was actually passed but not implemented was intended to make buying a car much more transparent. I'm all for that. I suspect it would kill off the slimy dealers and the "I'm going to flip my tie over the numbers on the paperwork" sort of shady crap that used to be out there, and still is in some areas. The wording was a no-go, so last I heard it was getting some revisions before it really goes into effect. It would also legally prevent dealers from showing a vehicle at a price you can't actually buy it for because they're quoting A-Plan, plus stacking several incentive programs that don't combine, or incentives from other areas, etc. The number of ways to manipulate how a vehicle is advertised are awful. A level playing field would certainly help consumers, and clean up a lot of the add-on garbage.

 

In Wisconsin, we are in fact required to disclose on the vehicle and in advertising not only that we have a Doc Fee, but how much it is. Is it listed specifically as part of the price? No, it's listed on the Buyer's Guide on used, and adjacent to the window sticker on new, and at the bottom of every vehicle description page. I'd be totally fine having a requirement that the price had to show the Doc Fee online - it would make it easy to pick out who has a really high one.

 

Part of what I do is making sure we're compliant with the laws, and the intent of the laws. Any new vehicle incentives are what anyone in our ZIP code could walk in and get, nothing tied to any financing, affinity programs, plan prices, or specials that aren't sent to everyone. Certain things simply cannot be included, because they vary from buyer to buyer. What's your tax rate? Do you need new plates or are you transferring? Are you buying a hybrid or EV that changes the plate fee? Your address might as well, because of the variety of county and municipal wheel taxes. Are you adding anything to the vehicle? Do you have any special incentives?

 

On the topic of out the door disclosure, I do have and use a spreadsheet that does the math for me, and includes tax, title, license, and fees, as well as any rebates, accessories requested by the customer, discounts, and such. I go looking for ICI/Private Offers on every new car customer, because I want to get them every incentive I can. When the customer gets numbers from me, they're real world numbers, not "price + TTLF". We all know not every dealer is set up that way, which I find distasteful. Just being honest and up front is so much easier than trying to be sideways.

[twintornados]

@BenKohnen in your post, you state as follows; 

 

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In some states it's regulated, so when the state says "a dealer's document fee cannot exceed $999", the dealers will set their Doc Fee at $999.

 

It is not a tax collected by the State, it is a fee regulated by the State - I have told the dealership, if it isn't a tax, I am not paying it" - I don't care if the State regulates it, they can set the fee lower or include in their cost of doing business. Put in general, I will always negotiate every aspect of the sale including the ridiculous fees they want to charge for doing business with them. They will claim, "Bu..bu..but, we have to send someone to the DMV....blah, blah, blah" I tell them that I can go there just as easy for a helluva lot less than their stated "fee"...then I after that is taken care of...time to go and negotiate with the F&I guy over the interest rates, undercoat and paint protection packages, etc....I will ALWAYS negotiate and never just limply accept them as "a cost of doing business"...you want my business? Earn it!! 

Edited March 4 by twintornados

[akirby]

2 hours ago, BenKohnen said:

I thought the Doc Fee was just something that was added to pad the boss' pocket. Our $299 doesn't cover the expense per car of doing the unshown business.

But in every other business that's just called overhead and there aren't separate fees.  It's like going to a restaurant and being charged a separate dishwashing fee that wasn't part of the menu prices.  By making it a separate fee they don't have to include that in the advertised base price of the vehicle and unsuspecting buyers don't understand it's negotiable.

[BenKohnen]

There's a spot where it can potentially get legally troublesome with the Doc Fee. If it's policy that it's charged, and some people don't get it charged to them, could it be discriminatory that it wasn't charged to everyone? Us grown adults can say "no, that's dumb", but in today's society that's a very real risk. I'd much rather shave $300 off the car's price than remove the Doc Fee. It's that big a deal.

 

I was thinking about added fees through the morning, too. We're seeing a lot of places adding 3% if you pay with a card rather than cash because of the card company fees, yet it's rarely posted as policy. I also remember seeing fuel surcharges showing up on UPS shipping invoices when fuel prices were high. Then there's buying event tickets online. Your price might be $X, but then there's six different extra fees, some hilariously labeled "convenience fee". Speaking of restaurants, some are automatically adding a tip to your bill... you can add more, but you're locked into the base tip. Just a few examples of businesses having added fees that could be part of the cost of doing business, but get passed on to the consumer.

[rmc523]

3 minutes ago, BenKohnen said:

There's a spot where it can potentially get legally troublesome with the Doc Fee. If it's policy that it's charged, and some people don't get it charged to them, could it be discriminatory that it wasn't charged to everyone? Us grown adults can say "no, that's dumb", but in today's society that's a very real risk. I'd much rather shave $300 off the car's price than remove the Doc Fee. It's that big a deal.

 

I was thinking about added fees through the morning, too. We're seeing a lot of places adding 3% if you pay with a card rather than cash because of the card company fees, yet it's rarely posted as policy. I also remember seeing fuel surcharges showing up on UPS shipping invoices when fuel prices were high. Then there's buying event tickets online. Your price might be $X, but then there's six different extra fees, some hilariously labeled "convenience fee". Speaking of restaurants, some are automatically adding a tip to your bill... you can add more, but you're locked into the base tip. Just a few examples of businesses having added fees that could be part of the cost of doing business, but get passed on to the consumer.

 

I HATE the event tickets thing.  Just advertise the "all in" price from the get-go.  Don't tell me the seat is $50, get me thinking ok that's not bad, I can do that, and then by the time you're checking out, the seat is actually $150 with the BS fees.  I'd rather know that $150 price up front because I'll look in another section that I'm more willing to pay for.

[Motorpsychology]

17 hours ago, BenKohnen said:

There's a spot where it can potentially get legally troublesome with the Doc Fee. If it's policy that it's charged, and some people don't get it charged to them, could it be discriminatory that it wasn't charged to everyone? Us grown adults can say "no, that's dumb", but in today's society that's a very real risk. I'd much rather shave $300 off the car's price than remove the Doc Fee. It's that big a deal.

 

I was thinking about added fees through the morning, too. We're seeing a lot of places adding 3% if you pay with a card rather than cash because of the card company fees, yet it's rarely posted as policy. I also remember seeing fuel surcharges showing up on UPS shipping invoices when fuel prices were high. Then there's buying event tickets online. Your price might be $X, but then there's six different extra fees, some hilariously labeled "convenience fee". Speaking of restaurants, some are automatically adding a tip to your bill... you can add more, but you're locked into the base tip. Just a few examples of businesses having added fees that could be part of the cost of doing business, but get passed on to the consumer.

I agree that a "Fee" must be charged equally to all customers. It's up to the customer to negotiate a better price for the product and/or trade in. 

The last car I leased, a 2018 Escape, carried a $600 (now at $695) "Acquisition Fee." on a 24 month lease, plus a $150 document fee from the dealer. We turned in that car for a 2021 Ranger ('nother doc fee)which we bought. We had no intention of buying that car at lease end, but if we had, there would've been a document fee there, too.

 

I'm about to buy a a new motorcycle (2026 Triumph Tiger Sport 800 Tour, for y'all moto-heads) which will carry a doc fee of I believe $200. Maybe I should request a $200 "inventory reduction fee" as the cost of doing business with me.

[BenKohnen]

That actually brings up another point - there was a wording that came out of the dealer's association here in WI a couple years ago that on a lease buyout that originated at the same dealership, we should NOT charge a Doc Fee. The one exception.