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Should You Pay the Dealer Advertising Fee?

Every dealer is required to participate in regional= association which buys advertising to promote all dealers within that region. Whenever you see a commercial inviting you to visit your "area" dealer, this is being funded by these regional groups.

This type of advertising costs dealers a good amount of money, sometimes adding $300 or $400 to the cost of each vehicle. Some manufacturers such as Honda include this cost within the invoice price so you never see the advertising fee.

However, some manufacturers don't include it, or they have it as an additional line item on the invoice. These advertising fees are usually listed as acronyms such as FDAF (Ford Dealer Advertising Fund) and TDA (Toyota Dealer Advertising Fee).

As a general rule, you will need to pay the advertising fee - most dealers will not negotiate on it. However, be aware that dealers try to pass off other fees by calling them advertising fees when they're really not.

If the advertising fee is not listed on the factory invoice, but the dealer is including it in the final price, this is where you will need to pay close attention.

The best way to limit any unscrupulous fees is to use my car buying guide or the CarWoo buying service and compare all the fees between dealers.

If it's a legitimate advertising fee, you will see similar fees from all dealers. If one really stands out for being too high, it's a good indication that dealer is trying to pad his profits with BS fees.

My Recommendation for Car Shoppers

TrueCar No-Haggle and Edmunds Price Promise are the quickest way to see the lowest car prices in your area. These sites show you no-haggle prices from dealers closest to you - and the deals are usually really good. This should be the first step you take when negotiating your car price. Follow this up with my checklist to make sure you squeeze out every last bit of savings.
- Gregg Fidan

Gregg Fidan

About: Gregg Fidan

Gregg Fidan + is the founder of RealCarTips. After being ripped off on his first car purchase, he devoted several years to figuring out the best ways to avoid scams and negotiate the best car deals. He has written hundreds of articles on the subject of car buying and taught thousands of car shoppers how to get the best deals.

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