Are Destination Charges Negotiable?

Dustin Hawley | Sep 28, 2022

The automotive industry is currently in a difficult position. With prices for vehicles and fuel rising, consumers' purchasing capability is declining each day as the country combats inflation. This creates a scenario where choosing the wrong vehicle can prove to be a decision that results in potential financial setbacks. 

Are Destination Charges Negotiable

Knowing how dealerships create price tags can be beneficial because your dream ride may become costly closer to the end of the year. After all, specific fees always play a significant role and may unnecessarily inflate the sum.

Let’s discuss destination fees and give some invaluable advice about purchasing vehicles. 

What Is A Destination Fee Or Charge?

In essence, a destination fee is a charge for delivering a new car from the factory to its point of sale. While it is typically the dealership, the final destination may sometimes differ depending on purchase terms. 

Dealerships include such charges to recompensate preparation and logistical costs. The car is transported from the factory to the dealer, and it costs money to transfer it. It is not about profit but rather about cutting back losses as they first have to pay the manufacturer.

The fees vary between manufacturers and depend on the vehicle model. Generally, they are from below $1,000 to $1,500. Destination charges may increase on high-end vehicles. For example, buying a Ferrari could set you back up by an additional $3,950. 

Are Destination Charges Negotiable?

When you come to the showroom, you will see the MSRP or a window sticker attached to the vehicle. This document lists all equipment and options for the car that factor in the price. A destination fee is always somewhere among those but might be stealthily included without any mention. Is there a way to avoid paying this fee?

The answer to that is, unfortunately, no. Even if you buy straight from the factory through the dealership, this destination fee would still be baked into the MSRP. Dealers see this fee as justified, so they will include it in the vehicle’s total price any time extra legwork is involved. They consider that programs like these are about experience and may even include lodging, meals, and personalized vehicle handovers. Once again, this increases the final price.

But Can I Drop The Car Price In Any Other Way?

Seeing as destination charges are getting more expensive, it’s valuable to potentially offset the total car price by at least $1,000 or $1,500 to help cushion the blow. You can achieve that through the basic principles of haggling. Check out the window sticker, make sure the destination charge cost is included, and proceed to reduce the “out of the door” price by this amount. Dealerships expect you to haggle, so they will not object to the strategy. 

Additionally, buying a used car may not incur this fee. It’s common for the seller to deliver the vehicle directly to the dealers for a trade-in. Even if a dealership acquired this car at an auction, they would pay a small sum to ship it to the showroom. That makes the fee extremely minute and, once again, opens the door for haggling. You could just try dropping this small extra cost, as this loss is negligible for them.

Summary

In the background of rising car prices and destination fees, always look for ways to save money on your purchases. While the charges are non-negotiable, haggle wherever possible and look for offers that benefit you personally. 

Be sure to always check the MSRP and never purchase the vehicle unless the destination fee is visible. Always locate destination fees in this document, and if you are unsure where to find them, they are often located at the bottom right above the listing for “total MSRP.” 

Dealerships justify an extra and unnecessary cost by explaining that the vehicle had to go in a specific lot far away from the factory. If you notice that the dealer sneakily adds transportation or delivery charges on top of destination fees, be persistent in haggling. 

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