Tesla has increased its destination and documentation fee for all its vehicle models currently sold in Canada by 33%, a move that has sparked discussion among potential buyers.
In Canada, the destination and documentation fee is a mandatory charge added to the price of any new vehicle. The destination fee covers the cost of transporting the vehicle from the factory to the dealership or delivery location, while the documentation fee covers administrative tasks like processing paperwork and registration.
While this fee varies by manufacturer, it is typically non-negotiable and can add several hundred to a few thousand dollars to the total purchase price. In the case of Tesla, their destination and documentation fee for the Model S, Model 3, Model X, and Model Y was $1,880. However as of late last week, it is now $2,500, a $620 (33%) increase.
The Cybertruck, which is expected to begin deliveries in Canada in early November, has its own destination and documentation fee of $2,750.
Tesla has not explained the reason for the substantial increase in the fee, but one potential reason could be the recent 100% tariff imposed by Canada’s federal government on Chinese-made electric vehicles (EVs). While Tesla was able to avoid the tariff by switching their logistics to send cars to Canada from the United States, the switch was costly and Tesla may be attempting to recoup some of those costs.
The increase in the fee comes as a double or even triple whammy for potential Model 3 and Model Y buyers. Tesla recently removed the referral discount for the Model 3 in Canada, taking away a potential $1,300 discount. Additionally, the Model and Model Y lost some provincial rebates due to the removal of the base Rear-Wheel Drive (RWD) models and the introduction of the new Long Range RWD models. Add it all up and the Model 3 and Model Y can be as much as $9,000 more expensive than they were just a few weeks ago.
This is not the first time Tesla has raised its destination and documentation fee in Canada. The last increase took place in May 2022, when the automaker adjusted the fee from $1,280 to $1,880, making this new hike the second significant jump in just over two years.
