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Dispose of disposition fees, retain customers

Dispose of disposition fees, retain customers

Published Dec. 2018

“Disposition fee ... what is that?”

It’s a question commonly heard from customers after returning a leased vehicle. While it is pretty common across the industry, the lack of knowledge around what it is can oftentimes create frustration among customers.

Here are a few tips on how to dispose of your customers’ frustrations on disposition fees:

  1. Make it simple. The easiest way to help customers understand a disposition fee is to explain it in a way they understand. A disposition fee is charged by GM Financial (not your dealership) at the end of a lease to cover the cost of reselling the vehicle. The fee is part of our standard lease agreement.

  2. Share the good news. After learning of the fee, most customers will ask if or how they can avoid paying it. In the customer’s original lease agreement, we state that we will not charge the disposition fee if:

    • the customer purchases or leases a new GM vehicle, or
    • the customer exercises his or her purchase option under the lease.

While the disposition fee varies by brand, this fee can cost the customer up to $595 on top of any other fees like excess wear and use and excess mileage.

By understanding disposition fees and being able to offer your customers the ability to have the fee waived, your dealership can make a new sale, and the customer avoids paying these fees and drives away in a new ride. It’s a win-win.

Use these tips to help extend the life cycle of the customer at your dealership.

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