Even after class action suits against GM, Ford, and Stellantis, destination charges continue to rise industry-wide. And as Automotive News reports, very few customers notice the costs as they tend to be buried in the details.
You might think that the increase in charges has something to do with the global supply chain distortion due to Covid. But reports from both Edmunds and Consumer Reports show that American automakers have increased these charges faster than anyone else in the last four to five years — or, well before the pandemic. The class-action suit against Ford that was filed this summer claims that Ford has increased their destination charges “42 percent over the last four years”, a rate that outpaces some luxury automakers. The problem with these fees, the suits claim, comes from the fact that buyers aren’t aware that automakers pocket a portion of these fees. One suit against Stellantis even went so far as to call the fees “hidden markups”.
Stellanis is also the worst offender. Its fees have increased across most of its brands over the last four years.
FCA’s shipping charges began to jump around 2017, Monticello said. Consumer Reports found that they rose an average of 90 percent for Chrysler, Dodge and Jeep vehicles from 2011 to 2020, 74 percent for Ram trucks over the same period, and 114 percent for Fiat from 2012 — its first full year of U.S. sales — to 2020.
The recently introduced Jeep Grand Wagoneer for instance has the highest destination charge I’ve ever seen on a car. No matter the trim, its destination charge is going to cost you $2,000. One Jeep dealer owner in Houston had a customer complain about it but said most of the time it’s not an issue since it’s rarely noticed.
Most of the time, they don’t even see it really because it’s embedded in the invoice,” said Wolf, who owns Helfman Dodge-Chrysler-Jeep-Ram-Fiat in Houston. “It adds to the cost of the vehicle, but in my experience, it’s very rarely an issue.
As automakers continue to not be entirely clear on how the charges break down, some call for pricing transparency. Even more so since the fees arent negotiable. As Consumer Reports Mike Monticello put it, “It just feels like they’re not being transparent, and it seems so weird that the destination charges are all over the map.”