Why is the Destination Charge of $790 on the 2015 Fits that are made in Mexico the same as the 2013's that were made in Japan?

Seems that transportation should cost Honda much less coming from Mexico.

Has Honda given any valid reason. Or are they just pocketing the additional savings.

 

Because they can?

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So "Destination Charges" have no basis in reality to actual costs?

Is this true for all automakers or is Honda special?

 

At some level, that's probably an accurate statement. That said, there is definitely a cost to shipping a new vehicle, and probably some markup at each handoff along the way. You pay for that one way or the other. Doc Fees are a similar item - there's definitely some cost to the dealer in preparing your documents (tag, title, etc.), but I doubt it's $165 worth of time and materials (the maximum allowed in my State).

Years ago when I bought a completely stripped base 1990 Honda Civic 3-door hatch, I was actually able to negotiate out of paying the Dealer Prep fee (but not destination charges). I had to scrub the cosmolene off the wheels myself, tho!

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Compared to Canadians, Americans have it good when it comes to freight charges. I pre-ordered a Fit up here, with freight and PDI(pre-delivery inspection) charges costing $1400. Apparently the delivery charges are equalized across the board for all buyers, so everyone pays the same insane amount.

Here's a good article about the insanity: A Canadian in Ontario, buying a Toyota RAV4 that's made in Ontario, will pay $1500 in freight charges. An American in Hawaii, buying the same car, will only pay $900 to have it shipped all the way there

 

I'm a Logistics Manager for my day job and honestly the transportation industry has seen GRI's (general rate increases) in all markets. There is a driver shortage for truckers too. Demand is up, carrier supply is down, thus carriers charge higher prices for favorable freight routes for profitability. If you live in an area that there isn't freight coming back in the opposite direction where the freight carrier came in, expect a higher cost going in to cover his empty miles.


While I don't doubt that the destination charges (freight charges) to move the vehicles from plant to DC/dealer are marked up over the actual cost for profit, it can't be that much of a markup.


To be honest its fairly reasonable in my eyes to move a vehicle. HI customers have established freight forwarders and work off of volume. Canada customers get shafted simply due to location and customs/duties/taxes/fees etc. I have a Brampton, On facility I work with and let me tell ya, the pricing is apples to oranges when compared to our corp address in CT and DC in Washington state.

 

The destination charge is just a way of lowering the list price for advertising purposes. I don't pay a destination charge when I buy a TV at Best Buy, or a bunch of bananas at the supermarket. The number has nothing to do with reality.

The only number that matters at the dealership is the number you write on your check. If you let them play shell games with any other numbers they will snow you just like a Three Card Monte mechanic. Remember, they are pros at this and we are, at best, amateurs. The only chance we have is to keep things as simple as possible.

 

Destination charge is an average for all models being sold in the states, regardless of where the vehicle is coming from. All Honda's have the same destination fee.

Destination fee is not negotiable, the same way paying state tax is not.


That said, are manufacturers making money off this fee? Absolutely.

 

I looked up my window sticker for the 2008 Honda Fit we purchased new and back then the Destination fee was $670.00, and that car came from Japan as well. I suspect it is like everything else over the last 7 years, prices rise. That is the one fee I never even try to negotiate when I purchase a car. Built into that destination fee is also advertising expense for the car (those tv ads and glossy brochures are not cheap).

 

its all just an extra term so they can add to a fee for you to pay.... none of it is real... and each time they have to go "speak to the manager"... just standard protocol to sound like they are going to a higher authority to make it seem like your getting a deal....

and after you finish negotiating they will find some kind of tax or fee to add to make it end up being the price they wanted to sell the car in the first place....

the best thing to do when buying a new car is just put down what your willing to pay.. and if it doesn't go your way.. then just walk away... if the dealership wants your business they'll work with you. and not with any of that B.S. "i have to go talk to my manager" or.. "everyone has to pay taxes" or... "destination fees" .. or... "we are selling this to you at our lost..." its NEVER their lost when they are selling you a car.

 

Everyone DOES have to pay tax. This isnt a dealer fee, it is a state fee that the dealer must collect on behalf of the state. You can skip paying it by not registering your new vehicle, but will have to pay it anyway when you decide to register it.

As someone who has worked in the automotive field for over a decade now, i have taken quite a few "loser" deals. Losing $400 on a sale today to a local is ok where i work, as we will see $1000 come back through the service department over the next few years. Sales just keeps the lights on, most every dealers backbone is their service department.

 

Well, you have to pay off the mayor of the town it was made in, the local police chief, the federales, and the border agents.. Not to mention, the actual cost of shipping.

 

Destination fee is the only fee you will also find on the car web site, and printed on the window sticker. It is Honda's fee, not the dealerships. You may think you negotiated it away, but if you don't pay it, the dealership does, or they manipulate your trade in to recover it, or overcharge you for finance charges, or sell you an extended warranty (and the list goes on). Someone pays the destination fee. Think of it like the fee stores in a mall pay, which is contractual, unless your sales exceed a certain amount, then your fee's increase as well. The Mall (Honda) uses that money to advertise (on your behalf).

 

I think most of that goes to the Honda organization that imports them, which also covers port fees and trucking fees.

 

i mean.. i know....

They do it almost everywhere....

Dealer - "Ohhhh yeah heres a 1,000 charge on an automatic...."
Me - "Oh thats great because I actually want a manual"
Dealer - "ohhhh I am so sorry nobody wants a manual these days so we don't carry them in stock.. and i doubt you will find a honda dealership that does... so thats going to be a fee for us to actually a manual... so thats a 1,000 dollars anyways.. uh huh..."
Me - " "

my friend is trying to buy a honda fit right now in a different city and hes going thru the same problems trying to get a manual.... I am getting sick of Honda dealerships... if honda's weren't such great cars I think i would go somewhere else and not deal with this kind of crap... but with them selling the best cars... i guess its kinda worth it to actually pay that premium to get one of the best cars ever made.

 

FYI... It seems as though the big dealers in the big cities tend to carry a few Manuals. I see them at the big dealers here in Denver, but not all the dealers.

 

Vash, above, makes a good point about setting your own price and sticking to it. It also helps to go through some kind of buyer program I picked up my new Fit three weeks ago, after going to Costco's buyer program getting their price, which was $100 over the dealer's invoice. Two dealers were signed up to accept that amount, no negotiating. In my small home town where unexpectedly the Fit I wanted showed up, I offered them Costco's price, showing them the paperwork, and they, too, accepted it. No running back into the manager for approval. Another smart approach with sales people is to require the manager to sit out front with you and the salesperson. No triange-ing. And in the end, as Vash said, be prepared to walk away. My partner also recently bought a new Fit. She walked, and a day later they called and asked her to return on her terms. It works.