Isn’t that a little excessive?
The vehicle addendum sticker scam may also be called the “Dealer Add-on Sticker scam.” The addendum sticker is an additional sticker created by the dealer that coordinates with the look and feel of the manufacturer suggested retail price ( M.S.R.P. ) sticker.
All Car Dealer Scams
The addendum or dealer add-on sticker is a dealership created sticker that will contain various high profit and/or overpriced accessories or products to add profit to the vehicle for sale.
An addendum sticker is conveniently placed beside the large Manufacturer’s Suggested Retail Price (M.S.R.P.) sticker that has all the options and pricing of the vehicle from the manufacturer. Some car dealers get very creative with their addendum stickers and make them look official and identical in format to the manufacturer stickers.
On closer inspection, you may notice the price on the addendum sticker is a lot higher than what the total price is stated on the M.S.R.P. sticker. This is because a dealer can add high profit dealer added options, market adjustments, or just about anything they want to add to the sticker. Additional charges found on an addendum sticker can be extremely bloated and you should be reviewed carefully.
These stickers get added to the vehicles as soon as they hit the lot. Some of the items included on an addendum sticker may or may not have been added to the vehicle.
Never start your negotiations from the Addendum Sticker or M.S.R.P of a vehicle!
Addendum stickers may include such dealer add-ons as: fabric protection, undercoating, dealer fees, pin stripe, nitrogen, sunroofs, spoilers, market adjustments, extended warranty protection plans, and/or additional accessories such as alarms or music systems etc.
There are many times a sticker may get on a car before the work has been done. If a vehicle has an addendum sticker and claims it has wheel locks and pinstripes, make sure the car actually has the items listed.
There are several ways a car dealer and its salespeople will use the addendum sticker to their advantage. The main goal of the addendum sticker is to add additional profit on top of the manufacturer’s suggested retail price (MSRP). These products are usually very inexpensive to the dealer and have been excessively marked up to the customer. This is how the dealer mindset works when it comes to an addendum sticker.
Outrageous mark-up on dealer added options – A spoiler added to a car will cost the dealer around $250 in parts and labor. The dealer will then list the spoiler on the addendum sticker for $800-$1,250 or more.
High dollar pin striping – Dealer’s may have their vehicles pinstriped at a cost of about $15 per car and then charge up to $175 or more to the customer.
Conversion packages – chrome or alloy wheels and tires, truck lift kits, sunroofs and gold packages carry very high profit margins for a car dealership.
Dealer packages – Loaner car for life, oil changes, maintenance packages, etc. The list goes on in this area, car dealers are excellent in finding new and improved ways to overcharge you. An example would be $2,500.00 charge for a loaner car anytime your vehicle is in the shop combined with oil changes for the life of you owning the car.
Make sure if there’s a dealer added option listed on the addendum sticker it’s actually on the vehicle. There’s many times an addendum sticker will get put on the car before the actual accessory has been installed on the vehicle. The dealer will have no problem “accidentally” charging you for something that’s not yet installed on the vehicle.
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Fabric Protection, rust proofing and under coating – Dealers may charge anywhere from $400 to $1,500 for protection packages that are already completed by the factory and come standard with the car.
Extended Warranties and pre-paid maintenance packages – These types of items are considered backend products and are optional. Some dealers will still try and include them within the price of the car. They should not be included in the price and should be your choice to buy them or not.
Market adjustments and additional dealer mark up fees – These are bogus fees. A market adjustment is just an added fee normally because of the popularity and demand of a certain vehicle.. These types of fees are usually associated with new cars arriving on the market.
My advice is to let the “NEW” wear off before paying a premium price for any new car.
I remember when the Chrysler P.T. Cruiser first came out years ago. You would see dealer added market adjustments as high as $8,000 or more over sticker. There was no way to get a dealer to budge on the price and the sad thing was car buyers eagerly paid the premium price. It just goes to show you, if someone wants a certain vehicle they have no problem overpaying for it.
This technique still rings true today. Some manufacturer’s have set rules in place and caps on how much a dealer may charge over and beyond the MSRP. However, many dealers have found ways around this and still add bloated market adjustment fees on highly popular or in-demand vehicles.
Be careful with this very effective little trick when looking at cars on the lot with a car salesman. Casually asking a car salesman what the price of a new car may cost you plenty. If you ask a slick car salesman the price of a car. He’ll walk you around to the M.S.R.P. Sticker of the vehicle, point to the addendum sticker price, and quote that amount to you.
Never start negotiating from the retail price!
After quoting the higher price to you, a skilled car salesman will quickly ask you another question to change the topic of the conversation. This misdirection keeps you from dwelling on the price of the car.
By quoting you a higher price up front he’s increasing his chances of making more profit on the car deal and raising your thinking up about the price. Then by changing the subject makes you forget about the price of the car until later during the negotiation process.
