Dealerships will sometimes tack onto your car invoice some interesting fees. Mostly they’re vague charges that many experts have differing opinions about what they even are. In some cases, the dealership will have a hard time giving specific answers to questions like, “What is a dealer Marketing Adjustment?”
Buying cars from places like CarsDirect, AutoWeb, and AutoVantage usually precludes you from things like Marketing Adjustment fees. These discount sites usually control how they market and advertise. New car dealers are an extension of the manufacturer.
What is a “Marketing Adjustment?”
That changes things because manufacturers have different promotions and advertising they initiate. But because dealers are part of the dealer network they can pay a certain amount for these promotions. That’s what the Marketing Adjustment attempts to reconcile.
The fee is an attempt to pass the marketing costs onto the buyer. They are legitimate costs of doing business. But it is the dealer’s cost of doing business, not the buyer’s. It is another cost like paying employees, building maintenance, and repaving, which are costs of doing business. That is why there is a cost factored into the vehicle’s invoice that pays for this as well as a tidy profit for the said dealer.
Many dealers will balk at dropping this fee but some will cave. What the dealers charge varies wildly; from a couple of hundred dollars to over $1,000. Because it is a separate charge it leaves the impression you are getting the vehicle for a lower price than you actually are. The Marketing Adjustment and other fees like “Destination Charges,” and “Dealer Prep” are just added charges that should be factored into the price.
What you should pay attention to is the bottom line
That’s what you should be focused on anyway. Not the separate charges and fees but the bottom line. Have the dealer add up all of the charges and taxes and then work that price down. At the end that is what you’re really paying for your car or truck. Let the dealer figure out how it can reduce the price to an acceptable cost to you. And don’t look at it is only a few more dollars a month reflected in your car payments. It is still a legit amount you’re having to pay.
Another way to look at it is that dealers are the recipients of promotions and regional advertising. These promos tend to increase awareness, interest, and ultimately get converted into sales. So dealers get back whatever the manufacturer is charging them.
Most dealers advertise right on your car
One more thing to keep in mind; most dealers advertise on your car. Some dealers attach chrome badges or dealer stickers on the trunk. And most all of them have dealer license plate frames you use until selling your car. And then the next person is likely to continue advertising with that frame. That should be worth more than whatever they’re trying to tack onto your bottom line. So stick to your guns and get the bottom line reduced.