Have you ever wondered what you're paying for when you buy a new car and the paperwork lists tax, license and destination charge? What is the destination charge all about? Well, if you've seen the trucks carrying cars on the highways or freight trains stacked with new vehicles, you are basically witnessing the service your destination fees pay.
Vehicle Freight and/or Destination charges refer to the process in which the manufacturer delivers the vehicle to the dealership.
Often vehicles of the same model type are manufactured in different parts of the world. With Toyota specifically, vehicles are manufactured in Canada, USA, Japan, and elsewhere. Toyota sets a amalgimated price for the cost of bringing vehicles from all over the world to each dealership in their country.
For example, the cost to the consumer is the same whether a vehicle is made in Canada, or made in Japan.
Each model has it's own Freight and/or Destination charge set by the Manufacturer, not the dealership. Furthermore these costs are standardized across the country (buyers in Newfoundland pay the same as those in Ontario or B.C.)
From an historical prospective, there was a time when you could travel to Detroit and pick up your vehicle direct from the manufacturer, thereby eliminating the destination charge. This ended over 30 years ago, when the automotive industry adopted equalized freight charges.