FTC Finalizes CARS Rule; Congress Wraps Up for the Year
This week the Federal Trade Commission (FTC) announced it had finalized a new rule, which will take effect on July 30, 2024, that it claims will fight “bait-and-switch” tactics and hidden junk fees, and bar misrepresentations about price and the total cost of a vehicle. The Combating Auto Retail Scams (CARS) Rule was originally proposed during the summer of 2022. At that time, AIADA joined with NADA and other auto industry groups in requesting an extension to the 60-day comment period to a minimum of 120 days, but the request was denied.
The Center for Automotive Research has estimated that the auto retail industry would incur as much as $22 billion in additional compliance costs over the course of a decade as a result of the new rule, and that an individual dealership could have as much as nearly $51,000 in recurring expenses annually to comply with the new regulation.
U.S.-U.K.
Despite a draft outline of a trade pact between the U.S. and the U.K. earlier this year that indicated that negotiations would begin before the end of 2023, it was reported this week that President Joe Biden had shelved the discussions until after the 2024 elections. The two sides initially set out to establish a critical minerals agreement that would allow U.K. firms to qualify under the Inflation Reduction Act for purposes of the EV tax credit.
Congress
The House of Representatives has adjourned for the year. The Senate is expected to stay in session for at least a few days next week to attempt to wrap up some unfinished business. Both chambers are expected to gavel in for the new year the week of January 8.
Quotes of the Week
“We’ve seen dealer pushback, we’ve seen congressional pushback, we’ve seen a lot of pushback from the media and others, but most importantly we’ve seen customber pushback. None of this works if we don’t have customers buying these [electric] vehicles.”
-Cody Lusk, President & CEO, AIADA (CBT News)
“This regulation is heavy-handed bureaucratic overreach and redundancy at its worst, that will needlessly lengthen the car sales process by forcing new layers of disclosures and complexity into the transaction. The FTC made up data to support its claims, then rejected calls to slow down the process and test the effectiveness of its proposal with real consumers. We are exploring all options on how to keep this ill-conceived rule from taking effect.”
-Mike Stanton, President & CEO, NADA (Automotive News)
ICYMI
In case you missed it, AIADA President & CEO Cody Lusk joined CBT News recently to reflect on 2023’s challenges and successes:
Friday Feel Good
Here is just one recent example of how dealers are doing good in their communities:
Scott Honda of Vineland in New Jersey partnered with Big Brothers Big Sisters Independence to provide meals to those in need. (h/t NJCAR)
We want to hear more about how you are supporting your local community – tweet us at @AIADA_News and use the hashtag #DealersDoGood.
You Auto Know will be on hiatus until after the New Year, at which time we’ll be back with all the news from our nation’s capital that You Auto Know about!
Happy Holidays!
