I’ve been shooping for a new car lately and have noticed the MSRP includes a destination charge. I’m curiouse as to how much of that goes to the railroads. Does it really cost $775 to ship a Corolla in an autorack?
Yes. Total transportation charge of train plus truck to dealer are calculated into each MSRP.
It costs what it costs, and delivery (or “destination charge”) would probably be the same whether the car was built inside or out of N. America.
Years ago, many years ago, the automakers would charge the dest. fee more literally, based on mileage (Note that that I am bending over backward not to say it was based on actual cost–Detroit is awful good about not letting production and distribution costs out of the bag.) But at some point, and I don’t know who initiated the change, the dest. fee was equalized across the country. So the Chrysler 300 made in Detroit has the same dest. charge on the sticker whether it comes from a dealership two blocks away, or from a dealership in Key West or El Paso.
Its a little more sophisticated than that. It used to be F.O.B. Detroit…freight on board originating in Detroit no matter what the car was or where it was made. Today the destination charges are based on either POE…point of entry…or manufacturing plant and they do reflect relative milages from those points to dealer.
Thanks for the info . . . still, I’m surprised at how much it costs to ship them (or better said, how much we are expected to pay to ship them). A Corolla fo $750 being a good example of this.
I would think the lion’s share of that $750 is a trucking part of the journey. A train most likely has an economy of scale that trucks don’t.
Another good reason to buy used cars. Destination charge on a used car $0.