When is the next FTC sweep of car dealer deceptive advertising?

After promising to start enforcing the rules they set for advertising practices, the Federal Trade Commission has been quiet for several months. Does this mean that another sweep is in the works?

Back in January, ten dealerships settled with the FTC over deceptive advertising. The offenses ranged from zero-down leases that didn’t mention leasing fees to low advertised prices that were only achievable with every incentive possible applied to them. It would take someone who was a veteran, a student, a member of the American Association of Retired Persons, and yet somehow still employed by a specific company to even get close to cashing in on all of the incentives in the ads.

This is why companies like Automark are so important in the automotive industry. With the escalation of state and federal agencies putting dealerships under the microscope, it’s important for dealers and their customers that the pricing applied to their online advertising undergo the right checks to stay completely compliant. Companies like Automark handle the pricing to disclose all applied discounts within the advertising. Their tool also safeguards against manual mistake from human error; if the price that the dealer attempts to post is strangely low, the system won’t allow it to go through without an override.

The advertising rules that the FTC and state agencies have put in place are more commonly broken by mistake rather than out of a desire to mislead consumers. For example, all discounts must be clearly defined in the advertised pricing in California, New York, and several other states. Unfortunately, most automotive website providers do not have the right tools to mark the discounts appropriately while still maintaining a connection to the appropriate incentives made available by the manufacturer.

“We have to do our pricing manually to make sure it works on our own website as well as third-party sites,” said an internet manager at a southern California Chevrolet dealer who requested to remain anonymous. “We received a warning from the state last year and we’re not going to let it escalate.”

Whether at the federal, state, or local level, the various agencies are looking to target dealers for the way they price their vehicles. When is the next sweep? We probably won’t find out until it happens.

Leave a Reply