— A GM "destination charge" lawsuit alleges the automaker sells and leases new vehicles while making a profit from the destination fees listed on the window stickers.
According to the class action lawsuit, GM shouldn't make a profit from delivering new vehicles to dealerships in California and New Jersey.
The General Motors destination charge class action lawsuit includes consumers in California and New Jersey who paid destination charges.
California plaintiff Robert Romoff purchased a new 2021 Chevrolet Equinox with a $1,195 destination charge, and New Jersey plaintiff Joe Siciliano purchased a new 2019 Cadillac Escalade with a $995 destination charge.
Both customers allege they didn't know General Motors made a profit from the destination charges.
The two plaintiffs claim they were mislead by GM's allegedly deceptive practice of forcing consumers into paying expensive destination charges for delivery of their new GM vehicles.
"[A] destination fee is generally understood in the automotive industry to reflect the manufacturer’s average cost of delivering one of its vehicles to a dealership. That destination fee is charged to the dealer and passed on to the purchaser or lessee of that vehicle. Consumers similarly have the expectation that they are covering an automotive manufacturer’s cost for the delivery of the manufacturer’s vehicles when paying the “destination fee” as part of their new-vehicle lease or purchase." — GM destination charge lawsuit
GM adds the destination fee to its Buick, Cadillac, Chevrolet and GMC vehicles, and although the vehicles may have different delivery fees, the lawsuit alleges the cost can be as high as $1,695.
Consumers cannot negotiate the amount of the destination charges and are stuck paying whatever amount GM wants to charge to purchase or lease new vehicles.
According to the class action lawsuit, GM includes a "significant amount of profit" in the destination charge and "deceives customers into paying far more than the actual cost of vehicle delivery" for new vehicles.
The plaintiffs claim the destination charge has little to do with the true cost of delivering a vehicle to a dealership, allegedly allowing the automaker to pocket "hidden markups" on the vehicles.
The two plaintiffs also claim they overpaid for their vehicles due to GM's failure to disclose the destination charge profit.
The same attorneys who filed this General Motors lawsuit also filed a destination fee lawsuit against Chrysler in May.
The GM class action lawsuit was filed in the U.S. District Court for the Southern District of California: Romoff, et al., v. General Motors LLC.
The plaintiffs are represented by Kaliel Gold PLLC, and Kopelowitz Ostrow Ferguson Weiselberg Gilbert.