The National Automobile Dealers Association gave the Federal Trade Commission an earful over its proposed restrictions on dealerships on the FTC’s last day taking public comment on the draft regulations, which are intended to curb bait-and-switch price ads and other unscrupulous practices.
NADA’s regulatory affairs president, Paul Metrey, wrote to the FTC that the proposed body of rules is “ill-conceived, ill-supported, ill-coordinated, untested and unlawful,” adding that it’s unnecessary in the first place, as “each harm it seeks to address is already regulated under existing law.”
Metrey continued that the regulations would “inject massive costs into the auto retailing process, greatly extend transaction times, greatly confuse consumers, and impede efficiencies aided by technological innovations that have significantly improved – and continue to improve – the customer experience.”
The trade group executive said the draft rules also lack “critical stakeholder input, essential customer testing and needed coordination with other federal agencies and state governments.”
NADA and other trade groups had unsuccessfully pushed for 120 more days to respond to the draft rules.
In addition to targeting bait-and-switch price ads, the proposal would regulate misleading finance-and-insurance office practices and valueless F&I products.
The 4-1 FTC decision favoring the rules said they’re intended to address customer confusion with add-ons, such as F&I coverage and after-market accessories.
“Many of the problems observed in the motor vehicle marketplace persist in the face of repeated federal and state enforcement actions, suggesting the need for additional measures to deter deceptive and unfair practices,” the FTC proposal says.
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