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Why do dealers charge a dealer handling fee?

Published on Jan 2, 2023 by Boulder Management Team


When it comes to buying a car, one of the expenses that a consumer will likely encounter is a “dealer handling fee”. These fees are charged by car dealers as an additional cost on top of the vehicle’s price and are generally not negotiable. This fee can range from a few hundred to a few thousand dollars and is typically used to cover a range of expenses that the dealer incurs when selling a car.


One of the main reasons why car dealers charge dealer handling fees is to cover the cost of their overhead expenses. This includes costs such as preparing your title work, the cost of a salesperson, office staff, advertising, and other general operational costs. These expenses are necessary for the dealership to sustain a healthy business and to be able to offer a variety of services and features to their customers.


Another reason that dealers charge a dealer handling fee is to help cover the cost of the dealership’s inventory. The cost of keeping an inventory of vehicles can be quite high and dealers must keep up with the demand of consumers in order to remain competitive. A dealer handling fee helps to offset this cost and allows the dealership to remain competitive while still providing the customer with a quality vehicle.