"Mandatory" dealer fees are the latest scam.
A friend of mine wants to buy a used car and asked me to help him out. He is looking for the second generation of the "new" VW Beetle, which was made from 2011 to 2019, and we're looking for a later model one with under 40K miles. Great, a fucking unicorn! But not as rare as it might seem.
Even though the second generation "new" Beetle was redesigned for a more masculine look, it seems to have been more popular with women, particularly elderly women. Within a 500 mile radius of my home, I was able to find about 20 examples, mostly in Florida.
We were camping in Florida and went to see one at a local Subaru dealer. Advertised for $22,500 with 15,000 miles on the clock, it was, according to Edmunds, KBB, and NADAguides, a little overpriced. But as it turns out, that price was the bait-and-switch price.
Since CoVid, dealers feel they can screw their customers mercilessly. That's about to end, as consumers' pockets are emptying out. One gag is to claim there is a "mandatory" dealer fee of $599, $999, or even $1499 that has to be paid in addition to the purchase price.
In this case, it was a $999 fee, which means the overpriced $22,500 Volkswagen is now an overpriced $23,499 Volkswagen. "But our price is competitive!" they argue. "But it is $23,499 with the fee!" I replied. "No, that's not part of the price, that's a fee!" they illogically argue. I guess they figure since half the country voted for Trump that everyone must be a moron.
But wait, it got worse - far worse. The overall sales price jumped to over thirty grand by adding a "reconditioning fee" of $3000 (for a car that arrived in inventory the night before) as well as an "inspection fee" of $750. It was downright insulting. Was this because we were gay and perceived as clueless?
The only weapon you have in negotiation is to walk away so we did. The next day, they lowered the "list" price - by $500. The problem is, if you pay $25,000 or $30,000 for a car that has a market value of $20,000, well, the day after you bought it, you just set fire to $5000 to $10,000 for no reason whatsoever.
By the way, when I asked about the "reconditioning fee" he said that was to replace the tires. Some expensive tires! He had a mechanic look at them and that was a bad idea. Even the mechanic was mystified as to why a car with 15K on the clock had nearly bald tires. Dry rot, you expect, but worn out tread?
The more I looked at the carfax (which showed it in dealer inventory for nearly two years in Michigan before being "sold" to a dealer in Miami) the more it seemed there was a "story" here. Used as a parts-getter with the odo turned off? (some manufactures supply cars to dealers with a removable tab which can be used to "turn on" the odometer at time of sale).
Then there was the minor accident damage which, upon closer inspection, seemed more major - and badly repaired. Urethane bumpers require a special elastomer in the paint and this one was already starting to chip.
Granted, low-mile cars have their own share of issues, like rotted tires and dead batteries. But this was starting to look less and less like a low-mile car. I'm glad we walked.
The best deals are from individual sellers - private party sale. Harder to come by in this day and age as dealers have gone out of their way to make it hard to sell via private party sale. The local grocery store where we lived in Virginia was threatened with a lawsuit by the local used care dealer association, as local residents were putting their "for sale" cars in the parking lot. Their argument was that, if more than three cars had a for sale sign on them, the grocery store needed a used car dealer license. Bullshit? You bet. But the grocery store backed down and put up signs threatening to tow cars away.
In addition to avoiding "dealer fees" and "reconditioning fees" and "inspection fees" there are also tag and title fees that can be avoided. You can't avoid sales tax and registration fees (7% title fee here in Georgia) but the dealer wanted $599 for their "paperwork processing fee" and another $399 for an outside tag-and-title service to obtain title and tags. These are both things you can do for free with a trip to your local DMV. So that's another $999 in savings.
The good news is, we found at least two private party sale cars with low mileage, both belonging to elderly women who lost their licenses. One is orange! Complete service records, oil change history, etc. And we're going to look at the orange one tomorrow. Price? $18,000 to $20,000 (asking). A far cry from thirty grand! And no Takata airbag recall! (VW has stalled on this, claiming there are no parts available to fix the problem - aging airbags may go off spontaneously and blow your head off - charming!).
No one weeps when a car dealer goes bust or a used car salesman does the honorable thing by putting his head next to a Takata airbag and driving gently into a brick wall.
I don't deny a car dealer a fair profit, but tacking on ten grand to a twenty grand car? Fuck that - and fuck them!
UPDATE: When we bought our last two cars (the Hamster and the King Ranch) we negotiated the price over the phone or via text (same for the Nissan). No hassle, no hidden charges. There are good dealers out there - or were. I think CoVid and Trumpism have destroyed people's minds and created this "what's in it for ME?" mentality. Also a new generation has come of age with apparently no fiscal skills. We have 20-year-olds going bankrupt on student loans, sports betting, Bitcoin, or options trading.
More on that, later.
