[Andreas]

"Administrative Fee"/"Dealer Prep", anybody not getting hosed by their dealers?

I decided to drop by my local Lotus dealer to put a deposit down for the new Elise.

I was about to sign the deposit form (they asked for $1,500) when I was told that I would be charged a $468 dollar "Administrative fee". This fee would be charged when I buy the car. It's also known as a "dealer prep"/"advertising fee"/etc.

I know this fee is totally bogus since I bought my Audi A4 from this same dealership and they tried tacking it on before. I got them to drop it from the Audi sale. They refuse to do it on the Lotus. They claim demand is too high.

My question is this, are people experiencing problems with dealers being incredibly stubborn with these charges?

This dealership wouldn't budge from the $468 dollar fee so I walked out. I don't like being taken advantage off.

I'm in Miami, so I have a few dealers within 400 miles. (3 within 30 miles).

Worst case I have a nice road trip from an out of area dealership and have a enjoy a good dinner with the money saved. =)

Anybody have a similar experience?

Thanks.

BTW: First time poster, been reading this site for a while now. Great stuff.

 

[jml1952]

So far, I have a $2000 deposit with Symbolic of Beverly Hills and a contract that says MSRP for the price. There has not been any mention of administrative/dealer prep fees, but I don't know what will happen when it comes time to place the actual order.

 

[Vantage]

They are tacking on this charge because they are not selling the actual car above MSRP. You did a good thing by walking about because that dealer has a totally unreasonable business practice when most are not tacking on these charges.

JML,
Symbo will be true to their word. As Nick Smith put it, "we're in business to keep customers, not lose them".

 

[MickOpalak]

When I put my deposit down at Lotus of Atlanta, the contract included about $300 in dealer fees. I figured I'd just give it to them, since they seems nice to work with and I really didn't want the hassle.

However, I've never had a 'good' experience buying a new car at a dealer. They are all scum.

 

[Win]

I will ask Criswell this question after I test drive the Elise. I guess they could say they are selling at sticker but then tack on extra fees. Criswell did mention to me that the waiting list will probably drop after the car comes out. Does that mean that unsuspecting customers are not going to want to buy the car after the tell them of the extra fees?

 

[Andreas]

When I put my deposit down at Lotus of Atlanta, the contract included about $300 in dealer fees. I figured I'd just give it to them, since they seems nice to work with and I really didn't want the hassle.

However, I've never had a 'good' experience buying a new car at a dealer. They are all scum.

I could deal with $200-$300, but I feel guilty about paying $500.

He is going to talk to the owner of the dealership and get back me today.

I first walked out of the salespersons office and called another local dealer from my cell phone. I got the other dealer to agree to a $200 fee.

When I told the salesperson this revelation he dropped the deposit amount from $2,500 to $1,500, but wouldn't budge on the fee.

The story he told me is that since the car is in such high demand, and that they are ONLY getting MSRP, that they need to make some money.

His cry for sympathy fell on deaf on ears =). I'm a bit confused since they are making money at MSRP.

The only reason this came up was because I specifically asked about this fee.

I think a lot of people will be surprised when they pick up their cars and they have to pay this.

When that time comes we will have almost no leverage since the waiting list will be at least one year.

The time to act is now.

 

[Hollywood]

this is a letter i got from my dealer

 

[Hollywood]

sorry for the big pic

 

[Andreas]

sorry for the big pic

Thanks for the picture.

They claim they don't add any fees but add a dealer fee? I'm confused.

And how much is that fee?

The Collection also has the administrative fee "printed" onto their invoices. When I bought my Audi A4 from them they put a nice little line through that fee and didn't charge it.

The charge is BS.

 

[Hollywood]

Billing and Handling- this charge represents costa and profit to the seller/dealer for items such as inspecting, cleaning, and adjusting new and used vehicles and preparing and documents to the sale. $396




That was already typed on the order sheet.

 

[Au111]

"Dealer Fee" or "ADP" it's all the same. It's their way of making easy $$$, although I wouldn't balk at a reasonable amount.

Nice penmanship, though.

 

[shinoo]

If you are willing to wait, these fees will evaporate. The supply will catch up to the demand and then discounts will be available. The downside is you may need to wait 2-3 years.

Keep shopping around. I think you can avoid the adp if you are willing to travel. Good luck.

 

[jml1952]

In most cases, I think that you have to accept some kind of dealer prep charge as just part of the game. If you find a dealer that doesn't charge that type of fee, consider yourself lucky.

Their product is a car, so one would think that the dealer needs to inspect the car and add fluids to get it ready for sale and that should be included in the MSRP. But that's not the way things have evolved.

Imagine if you went to McDonalds to buy the burger combo that you saw advertised for $1.99 and then they told you there was a $1.50 prep charge because they have to inspect your meal and assemble it. Most businesses couldn't get away with this. However, because a car is such a big-ticket purchase, they manage to do this.

Same thing happens when you buy a house. The bank charges you a certain interest rate on your loan, but they almost always add in a loan application fee of $250 or more. It's just a way to subsidize their internal costs and make a little extra money.

On a $40,000 car, an extra $500 doesn't seem like that much. I would prefer not to pay it, but I can live with it. I just don't want to pay an extra $5000 or more because the car is popular and the dealer can get away with a mark-up. So far, it sounds like most dealers will honor their commitment to MSRP for long-time depositors and just gouge the latecomers.

 

[zvezdah1]

I don't see a problem with a touch extra added on. The dealers are in a situation with this car is several years of pent up demand.

Are you willing to wait a year or so for the demand to decrease to save $500? I'll pay the extra fee, if any are involved and go on my way.

The fact that the dealers are guaranteeing list price is pretty good. What do you think the first elises that hit dealers would bring for all the "gotta haves"?

Chris

 

[Andreas]

I don't see a problem with a touch extra added on. The dealers are in a situation with this car is several years of pent up demand.

Are you willing to wait a year or so for the demand to decrease to save $500? I'll pay the extra fee, if any are involved and go on my way.

The fact that the dealers are guaranteeing list price is pretty good. What do you think the first elises that hit dealers would bring for all the "gotta haves"?

Chris

I don't mind pay around $200-$300 (tops). That is reasonable.

Pay $100-$200 more than what other dealers charge is ridiculous.

For the price I can pay for a short roadtrip to another dealer.

 

[smura]

If the dealer is charging a prep fee then they are NOT guaranteeing MSRP. That is the whole point.

My contract guarantees that I can buy the car for MSRP. IF they try and add on another fee then they will be trying to break their contract and they'll see me in court.

 

[Win]

We all know people work because they need to and they want to make as much money as possible. Just sounds a bit tricky when you ask them 'Are you selling the car for sticker?' and they say yes. Everyone that hears the 'yes' assumes that final price will be sticker (of course, tax, tags and other neccesities) and that is it. No extra fees.

 

[Win]

If the dealer is charging a prep fee then they are NOT guaranteeing MSRP. That is the whole point.

My contract guarantees that I can buy the car for MSRP. IF they try and add on another fee then they will be trying to break their contract and they'll see me in court.

Would/could a consumer win in court if this happens?

 

[zvezdah1]

smura,
yep, the answer to everything take em to court.

But by that rationale unless they specified tax, tag, etc. in the contract, if they charge that you can take em to court too???

Of course your option would be to refuse the deal when the car gets here, leaving them free to mark it up how many ever thousands over they'll be going for on ebay.
Chris

 

[smura]

Tax, tag, etc. are not paid to the dealer. They are owed to the state and at least in Washington state, the dealer is not liable for those amounts. Instead, the dealer collects these monies on behalf (or as an agent) for the state.

Therefore, these amounts can be properly "tacked" onto the price but do not become "part" of the price for purposes of determining what you paid for the car.