WASHINGTON — Two teams representing auto dealers mentioned on Friday they’d filed a authorized problem to the Federal Commerce Fee’s new sweeping client safety rules finalized final month.
The FTC mentioned the brand new guidelines will ban bait-and-switch advertising techniques, prohibit charging for add-on prices that don’t profit shoppers and require dealers to make key disclosures to shoppers, together with correct pricing disclosures in promoting and gross sales communications.
The foundations have been first proposed in 2022 and can take impact on July 30. In addition they require sellers to maintain information of sure commercials and buyer transactions.
The National Automobile Dealers Association (NADA) and Texas Vehicle Sellers Affiliation late Thursday requested the Fifth Circuit Court docket of Appeals to dam the brand new guidelines that “comprehensively regulates the promoting, gross sales, and financing of autos by auto sellers” saying they’re “arbitrary, capricious (and) an abuse of discretion.”
The FTC declined to remark.
The NADA mentioned beforehand the FTC proposal would “upend the gross sales course of for tens of hundreds of thousands of shoppers yearly and hundreds of small companies.”
The FTC mentioned the brand new guidelines would bar junk charges like a service contract for an oil change for an electric vehicle mentioned it’s anticipated to avoid wasting shoppers greater than $3.4 billion and an estimated 72 million hours yearly looking for autos.
Sellers can even be required to acquire consent for any costs they add to a automobile’s worth and barred from charging for add-ons which are ineffective to the client, resembling promoting nitrogen-filled tires that include no extra nitrogen than regular air.
The Alliance for Automotive Innovation, representing General Motors, Toyota Motor, Volkswagen and different main automakers, beforehand raised issues concerning the FTC plan, warning of “extreme regulation and micromanagement of the gross sales expertise.”
In November, a U.S. Home committee mentioned it was investigating the FTC’s client safety guidelines, arguing the regulation “threatens hurt to shoppers and small companies by making automobile purchases harder and inhibiting innovation within the business.”
A gaggle of 17 Democratic lawmakers in June urged the FTC to “undertake sturdy regulatory protections for automobile consumers,” arguing that “unfair and misleading practices involving motorcar sellers have widespread penalties.”