Consumer Advocates Applaud Members of Congress for Supporting FTC Auto Dealer Rule

June 22, 2023 — Press Release

WASHINGTON – Today, U.S. Sen. Ed Markey and U.S. Rep. Pramila Jayapal led 17 members of Congress in a letter to Federal Trade Commission (FTC) Chair Lina Khan asking for commonsense rules against abuses in the sale and financing of motor vehicles.

A large majority of American consumers rely on their car to get to work, school, healthcare, and other economic necessities. But buying a car is a painful process for consumers that generates tens of thousands of complaints to federal, state and local consumer protection agencies. 

“The FTC’s rule would bring welcome clarity and relief to the vast majority of Americans who want to buy a car without being taken advantage of by dishonest auto dealers,” said Erin Witte, Director of Consumer Protection for CFA. “We applaud Senator Markey, Representative Jayapal, and each Senator and Representative who signed this letter to show the FTC that it has support in Congress for a rule that will save consumers real time and money.”

The FTC used its statutory authority to publish a notice of proposed rulemaking last year which addresses some of the most common abuses in the sale and financing of motor vehicles. The rule accounts for the marketplace reality that it is far too difficult and time consuming to learn what price a dealer will accept for a vehicle. 

“A lack of transparency in auto financing obscures the true cost of a car and invites discrimination by unscrupulous auto dealers,” said John Van Alst, senior attorney at the National Consumer Law Center. “The FTC’s rulemaking seeks to address bait and switch pricing and the all too often lack of pricing information by requiring dealers to provide clear, upfront pricing for all buyers.”

Consumers have long complained that dealers unfairly tack on fees and charges that were not disclosed earlier in the process or which pay for useless and worthless add-on products and services. The FTC seeks to bring fairness to the marketplace by leveling the playing field and ensuring that dishonest dealers do not steal competition from honest dealers with this “bait and switch” conduct.