California’s Senate just passed a nail‑biter: a 488% increase in car dealership “document fees.”
Yes, you read that right—what was once capped at $85 can now be up to $500. This is not just a small bump; it’s a significant shift with big consequences.
On one hand, dealers argue that rising costs justify higher fees.
On the other hand, consumers—literal everyday car buyers—get squeezed.
And in my opinion, this is a very bad move.
It’s effectively shifting costs onto the buyer, with zero guarantee of better service or lower sticker prices.
What Just Happened
Under Senate Bill 791, dealers can charge a flat $500 fee or calculate 1% of the total vehicle price (whichever is lower).
That’s a wild jump from the old $85 standard.
This isn’t a gradual increase—it’s a sudden policy change that hits families and buyers in the wallet the second they sit down to negotiate.
Dealers Say Rising Costs Justify It
Dealerships claim they need this bump in car dealership fees to cover “paperwork costs,” including title registration, dealer prep, and compliance with DMV rules.
That sounds reasonable—but the reality doesn’t back it up.
If a dealer says they can’t cover documents for $85?
Maybe they should streamline or digitize the process.
Increasing fees by nearly 500% to cover inefficiencies doesn’t help consumers—and it doesn’t guarantee better service.
Consumers Get Burned
Here’s the hard truth:
- No guarantee of lower sticker price. Buyers can easily end up paying both a high fee and full MSRP. Dealers don’t have to reduce their margin.
- More “junk fee” hiding. Fees now can range widely—a murky cost vault disguised as paperwork.
- Dealers make the money, not buyers. “[This] is just benefiting car dealers at the expense of car buyers,” says consumer safety advocate Rosemary Shahan.
What Buyers Are Saying
In online forums like r/California, buyers are furious.
Many avoided in‑person purchases altogether, preferring to buy EVs like Teslas online to dodge the sticker shock
One user posted advice: “Get your out‑the‑door price via email. If they don’t comply, walk.”
That reflects a frustration that dealers can abuse this fee.
A Bad Deal for Buyers
Here’s what I think: This is a policy that helps a few dealership CEOs and lobbyists while hurting many.
- Affordability takes a hit: Car prices are already sky‑high. Add $500 extras, and you’re pricing out mid‑income buyers.
- It rewards inefficiency: Fees don’t force digital upgrades or better admin systems—it bills customers instead.
- Lobbyists win again: Dealerships donated nearly $3 million to lawmakers since 2015. The vote was bipartisan, with just one “no” vote.
This isn’t about covering costs—it’s about lobbying muscle and profit protection.
What Californians Should Do
Here’s how I think buyers should respond:
- Always ask for out-the-door pricing via email. Compare dealer breakdowns—fee vs no‑fee.
- Negotiate the fee. If they refuse to reduce it, walk. Dealers might match or back off.
- Support legislation that limits junk fees. Call your Assembly rep and oppose the bill in its next step.
- Buy digitally if you can. Brands like Tesla bypass dealers entirely—and their surcharges.
What’s Next
The bill now heads to the California Assembly—where we must pressure lawmakers to reject it or lower the limit.
There’s still a chance to de-escalate it from $500 to something like $200.
But if the Assembly passes it, the governor signs. This fee could spread to other states.
Other states will watch. If California normalizes a $500 doc fee, it becomes a national trend—and that hurts all buyers.
My Thoughts
I recently talked about the scams that car dealerships did, and now I’m writing about the increase in car dealership fees.
I am strongly against these kinds of policies. And I have decided to use my platform to help people understand what is going on around them.
Increasing dealership fees by nearly 500% is a move that prioritizes profits over people.
It’s a bad decision—one that won’t make cars cheaper, paperwork faster, or service better.
Instead, it loads costs onto consumers who already pay too much just to drive.
Dealers ask buyers to foot the bill for inefficiencies. That’s unforgivable in 2025.
My advice?
Push back. Negotiate every dollar. Say no to phone‑on‑the‑desk offers. And support any legislation that protects buyers, not dealer margins.
