FTC’s proposed rules on car dealer ads, F&I would hurt customers, independent dealers say

The National Independent Automobile Dealers Association on Friday said the Federal Trade Commission’s proposed new advertising and finance and insurance rules would hurt consumers and make vehicles more expensive.

The trade group estimated compliance would require at least $1.4 billion during the next 10 years, “driving up prices for consumers and making the car-buying process longer and more difficult.” It said many of the issues the FTC sought to address fall under existing regulations.

“Independent auto dealers are small-business owners and the proposed rule from the FTC has the potential to negatively impact the ability of our members to operate their businesses,” NIADA CEO Robert Voltmann said in a statement.

“We look forward to working with the commissioners and their staff to ensure NIADA members’ voices are heard.”

NIADA, which counts 16,000 dealerships among its members, represents the nation’s licensed used-vehicle dealerships.

The new proposals target auto-retail behavior such as bait-and-switch advertising and F&I products sneaked into deals without consumer consent.

The FTC said in its notice of rule-making June 27 that it received more than 100,000 complaints each of the past three years related to vehicle sales, service, rentals, leasing and warranties and transactions, and it said complaints about car deals are “regularly in the top 10 complaint categories tracked by the agency.”

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