What Are Administrative and Transportation Fees?

"What are administrative and transportation fees?"

Anonymous


We can only guess based on the information you provided, but it sounds like you're questioning charges that a dealer says you have to pay. If that is the case, have you asked the dealer for an explanation?

The only legitimate transportation charge on a new vehicle is the destination charge listed on the window sticker. That amount, typically $750 or more, is one that the dealer pays to get the car from the manufacturer, and you will have to pay to buy the car.

The only exception is if a dealer were to find a vehicle for you in another city and have it delivered to their dealership. In that situation, we would expect to agree on any extra charge before the car is shipped. If the vehicle was already there when you visited the dealership, the extra fee isn't something you should have to pay.

Administrative (or "administration") fees is the term used in some leases instead of "acquisition fee," a more common term for the upfront costs of financing and processing a lease agreement.

If an administrative fee pops up on a vehicle purchase, perhaps it is another name for document or "doc" fees, which dealers charge for registering the vehicle, applying for a title and other required paperwork (such fees are often regulated by states).

If the dealer says it's a charge permitted by state law or regulation, check it out. Contact your state's motor vehicle department or attorney general's office. If the dealer says it's a fee charged to them by the vehicle manufacturer, ask to see proof (such as an invoice) and check it out with the manufacturer.

Have a car question you'd like us to answer? Send us an email at [email protected], or ask in the comments below.

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By Rick Popely | September 15, 2013 | Comments (2)

Comments 

npaladin2000

Then again, "administrative and transportation fees" could be another word for "surcharge so we can make more money." This is also a serious possibility, which is why one should find out what specific charges are required in their state and then ask about EVERY line item on their new car purchase that isn't part of the list of required items. Generally that includes tax, title, registration, inspection, and destination, but some states may have additional requirements. If they combine it into some "doc fee" ask them what the components of it are, and check that the total number is what it should be, and not $500 more.

Shorebreak

When you purchase a vehicle from a dealer in Texas they try to saddle the buyer with a "Dealer's Inventory Tax". This is intended to reimburse the dealer for ad valorem taxes on its motor vehicle inventory. The charge, which is paid by the dealer to the county tax assessor-collector, is not a tax imposed on a consumer by the government, and is not required to be charged by the dealer to the consumer.

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