![](https://www.motorbiscuit.com/wp-content/uploads/2025/01/Car-buy-fees-money.jpeg)
For the past several years, the Federal Trade Commission has been waging a war against “junk fees.” These are the hidden fees that various venders hit you with as soon as you’re about to complete your purchase. We’re talking “resort fees” at hotels, “service charges” for concert tickets, and “seat selection” fees to keep your family together on planes. If you’ve bought a new car recently, you know dealerships’ junk fees have gotten out of hand, adding up to thousands of dollars above MSRP. The FTC tried to make every dealership advertise an out-the-door price…and the FTC lost.
Many car buyers spend hours or days choosing the best vehicle for their budget, hunting down dealerships offering deals, haggling for the lowest possible price, and saying “no” to salespeople’s’ incessant upsells. Then, when they are about to sign for their new ride they see thousands of extra dollars on the final price tag.
Hidden dealership fees are getting absurd. Many places are slapping on surcharges for paperwork fees, mandatory add-ons such as underbody protection or GPS trackers, gap insurance, redundant warranties, and the mysterious “destination charge.” That charge often includes shipping and vehicle preparation, but is $2,000 on many models–no matter where in the country you buy them.
By 2022, the FTC had had enough. It proposed an all-encompassing “offering price” dealerships could advertise that must include every fee. And they meant every mandatory fee. The only exceptions would be the sales tax and the state’s vehicle registration/license plate costs. The law was called the Combatting Auto Retail Scams, or CARS. Very clever.
The FTC calculated that CARS might keep dealerships from tagging on fees and save car buyers $3.4 billion a year. It might also save them 72 million hours in extra haggling and paperwork every year. Sounds like a win-win. For everyone but the sleaziest dealerships.
You won’t be surprised to hear that dealerships absolutely hated CARS. The National Auto Dealership Association, and a group of Texas dealerships with especially deep pockets took the FTC to court. First, they complained the government didn’t give them enough notice before implementing the law. But with CARS proposed two years ago, that sounds like a load of hogwash to me.
One dealership owner, on the NADA board argued that incorporating “new, untested forms” into the car buying process would cost the average buyer 60-80 minutes. He insisted this lost time was worth a combined $1.3 billion annually to car buyers. He should tell that to his salespeople who think nothing of talking at you for hours.
NADA and the other dealerships took the case all the way to the 5th U.S. Circuit Court of Appeals. One of the three judges, Judge Stephen Higginson wrote CARS would provide “price transparency and rules against deception, which would spur billions of dollars in economic benefit for U.S. consumers.” But his colleagues didn’t listen and voted it down 2-3.