The California Senate has passed bill 791 permitting car dealerships to raise buyers’ fees to as much as $500 per vehicle, a substantial jump from the current limit of $85.
Despite earlier commitments from both parties to lower costs for Californians, Senate Bill 791 has received bipartisan backing. The legislation allows car dealers to impose fees of up to 1% of a vehicle’s purchase price, with a maximum limit of $500.
On Tuesday, Senate Bill 791 was approved with strong support, with only one senator opposing it. The bill increases the maximum fee that car dealers can charge for processing documents by $415, raising the current limit from $85 to a new cap of $500 per vehicle. Market research firm Cox Automotive reported that in May, the average listed price for a new vehicle in the U.S. was $48,656.
California car dealers argue that fee increases are necessary to cover rising expenses associated with processing vehicle paperwork, such as loan documents, DMV registration, and fraud protection forms. These fees are separate from the vehicle’s purchase price.
The bill’s opponents, including consumer advocacy groups, have criticized the move, calling it a ‘Junk fee’ and a betrayal of efforts to lower living expenses. Rosemary Shahan of Consumers for Auto Reliability and Safety stated, “This is the opposite of saving money for people.” The legislation passed with only one dissenting vote from Democratic Senator Henry Stern, who argued that car dealers have not earned the trust to justify such fee increases.
The vote took place as reports surfaced that auto dealers are employing inventive strategies to sustain profits without increasing sticker prices in anticipation of the Trump administration’s proposed tariffs.
The bill now moves forward to the Assembly, where additional discussions are expected, especially concerning the fee cap. The legislation excludes state vehicle purchases from the fee, and further modifications may be considered before receiving final approval.
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