Letter to the Editor: Car Buyers

This is an unusual letter in that it is a consumer warning that almost certainly applies to you. You can take this letter either of two ways: as a consumer – beware when you go to buy a car; or as a political statement to show you which side your state government is on – the consumers (you or I) or the businesses that they regulate.

The Wisconsin DMV allows dealers to charge you a fee with the purchase of a car as follows (quoted directly from the DMV): “A dealer may assess a purchaser or lessee an additional service fee for completing any sales-related or lease-related vehicle inspection or forms which are required by law or rule…”

I recently had a car totaled in an accident and had to buy a replacement vehicle. The dealer charged me a fee which they stated was to recover out-of-pocket costs associated with registration and state imposed costs. The insurance company refused to pay this fee as they felt that it is simply part of the price of the car.

I contacted the Wisconsin DMV and they stated that this is an optional fee allowed by the state and simply closed my file.

In the case of this dealer, here is what this fee is to cover: (1) Detailing (I assume that this means washing cars) $3,696,000 or 60.8 percent of the approved costs; Safety Inspections, $1,848,000 or 30.4 percent of the approved costs; inventory and sales management $275,000 or 4.5 percent of approved costs; employees engaged in sales completion and compliance, $110,000 or 1.8 percent of the approved costs. These items amount to 97.5 percent of the approved costs applicable to this fee. The balance, 2.5 percent of the approved costs, applies to a number of items including: software, forms, paper, electronic storage of records, physical storage of records, and shredding.

You are likely in business and incur almost all of these costs. Which of these costs would you like to pass on to your customers as a “service fee?”

If you would like to see the DMV or dealer correspondence, please email [email protected] and I will send you their emails explaining this. If you want to contact the DMV to see if they can explain this better than I have, I will provide you that contact info as well. Or maybe you would like to drop a note to your representative and confirm who they represent.

Jim Riead

Egg Harbor, Wis.