Some models now require a $2,000 non-negotiable charge.
Demand for new cars has soared, with the semiconductor chip crisis still causing supply shortages. As a result, new car sticker prices are at a record high, even for popular models like the Ford F-150 that used to be readily available. According to research by Kelly Blue Book, the average price of a new car sold in September 2021 was $45,031 - a $10,000 rise in less than a decade.
And that's before you factor destination charges, the mandatory fee covering the car being shipped from the factory to the dealer. As reported by Automotive News, data from Edmunds shows that the average price of destination charges is rising rapidly.
The analysis found that the average destination fee increased by 12% from the 2017 to 2021 model years. Consumer Reports also found that destination charges for mainstream automakers increased from an average of $839 in 2011 to $1,244 in 2020.
Out of any brand, Stellantis charges the highest destination fees. On average, Jeeps, Rams, Dodges require a $1,573 destination fee, though the new 2022 Jeep Wagoneer and Grand Cherokee carry a substantial $2,000 destination charge. In the case of the Grand Cherokee, the destination charge increased from $995 in 2016 to $1,495 in 2019.
GM's average fee has also increased 21 percent to $1,242 from the 2017 to 2021 model years, with charges for the Chevrolet Trax and Buick Encore increasing from $995 to $1,195 during this period. Ford, Honda, Porsche, and Hyundai have also increased their destination charges by over 20% on average over the last four years. One exception is BMW, which still charges a $995 destination fee. In fact, BMW's destination charge has actually been reduced on average.
What is causing these rises is unclear, but a combination of supply chain issues and semiconductor chips, rising fuel costs, and a shortage of delivery drivers are likely to blame.