Auto experts warn hidden dealership fees can add thousands to vehicle purchases

(WWAY) — As vehicle affordability continues to be a concern for many Americans, consumer advocates say buyers should pay close attention to dealership fees that can add thousands of dollars to the final purchase price of a vehicle.

According to automotive retail analysts at CarEdge, some dealership charges are required by law, while others may be negotiable or optional.

Ray Shefska, co-founder of CarEdge, said one of the biggest mistakes consumers make is focusing only on the monthly payment instead of the total cost of the vehicle.

“The first and most important thing is to truly understand your budget,” Shefska said. “Understand what you can actually afford, as opposed to what you actually want.”

Shefska recommends shoppers request an itemized “out-the-door” price before visiting a dealership. The document should include the vehicle’s selling price, dealer-installed accessories, taxes and all additional fees. “If you were going to write a check, you want to know exactly what that check amount needs to be,” he said.

According to CarEdge, buyers have reported seeing thousands of dollars in added charges, including dealer-installed accessories, protection packages, documentation fees and reconditioning fees on used vehicles.

Shefska said taxes, title and vehicle registration fees are generally set by state or local governments and are typically non-negotiable. However, he said documentation fees, electronic filing fees, protection packages, nitrogen tire fills and some dealer-added accessories may be negotiable.

“If it’s taxable, it’s negotiable,” Shefska said. “Anything that’s taxable is negotiable. Anything that is not taxable is usually governed by the state.”

Among the fees Shefska considers most concerning are reconditioning fees charged separately on used vehicles. “The asking price of the vehicle should already include any reconditioning costs that the dealership might have had,” he said.

He also questioned high electronic filing fees, saying dealerships may charge hundreds of dollars for a service that costs significantly less to perform.

Another way consumers can identify transparent dealerships, Shefska said, is by requesting an out-the-door price via email or text before visiting.

If a dealership declines to provide an itemized quote and instead insists buyers come to the showroom first, that could be a warning sign, he said.

“If the dealer actually honors your request and sends you the information you’re asking for, that dealer is more transparent,” Shefska said.

Shefska also encouraged shoppers to research current market prices online and stick to a budget before beginning the buying process.

“Needs are less expensive than wants,” he said. “Don’t allow a salesperson to push you beyond what’s comfortable.”