The FTC wants to hear from you, the dealers at home

Citing repeated complaints from consumers, the Federal Trade Commission last month proposed 14 pages of new regulatory language targeting car dealership bait-and-switch advertising and certain finance and insurance business practices.

The pejorative language and prospect for additional regulatory obligations was not appreciated by the National Automobile Dealers Association.

"The FTC's proposed rule would impose a vast array of new, completely unwarranted, redundant and ineffectual requirements that will cause great harm to consumers by increasing prices, extending transaction times, and making the customer experience much more complex and inefficient," NADA CEO Mike Stanton said in a statement Thursday.

It seems unlikely the agency will accept this argument and retreat.

The FTC said in its notice of rulemaking June 27 it received more than 100,000 complaints each of the past three years related to vehicle sales, service, rentals, leasing and warranties and transactions, and it called complaints about car deals "regularly in the top ten complaint categories tracked by the agency."

The four commissioners supporting the rules include two Trump appointees and two Biden appointees — one Republican and three Democrats. Even if the rulemaking process continued past the 2024 election — Stanton called for a more thorough FTC investigation — and into a different presidential administration, none of the four supporters' terms end before mid-2025.

What the industry can do is help shape the FTC's rulemaking. At some point, the agency is going to officially post its proposal in the Federal Register. At that point, the clock will start ticking on a 60-day public comment period (though NADA is seeking to extend this timeframe).

Keep an eye on www.regulations.gov and be ready to comment on proposal No. P204800 when it drops. Other means of submitting comments can be found in the unofficial notice of prepared rulemaking posted June 27 by the FTC.

If you haven't read the proposal yet, the 126-page unofficial version can be found here. It contains the regulatory language the FTC is proposing to add. It also contains the FTC's rationale for it and estimates of potential costs to the industry.

And if you'd like to comment but aren't sure what to write, the FTC proposal also asks readers for input on 49 specific questions, including areas a dealership professional or F&I product provider would probably want to weigh in on, rather than let rules be written based on other people's assumptions.