"According to the FTC, advertisements for vehicles must clearly include all mandatory fees that a customer would have to pay to purchase the car. If certain costs are unavoidable, such as required dealer add ons or fees that apply to every buyer, those charges should already be reflected in the advertised price."
"The agency said advertisements that appear to offer a low price but then add unavoidable costs later in the transaction could be considered deceptive. This practice is commonly referred to as "drip pricing," where the advertised number does not represent the true cost of the product."
"The FTC stressed that if an advertised price depends on special conditions, such as a military discount, loyalty rebate, or financing requirement, those limitations must be clearly disclosed. Prices that only apply to a narrow subset of customers require explicit disclosure of eligibility requirements."
The Federal Trade Commission issued warning letters to 97 auto dealership groups regarding misleading pricing practices in vehicle advertisements. Dealerships must clearly disclose all mandatory fees in advertised prices, ensuring the displayed amount reflects what buyers actually pay. The FTC prohibits drip pricing, where low advertised prices later include unavoidable costs. Dealerships cannot advertise vehicles unavailable for purchase at promoted prices. Additionally, discounts and rebates presented as broadly available must clearly disclose limitations, such as military status or financing requirements. These rules apply to online and in-dealership promotions as consumer vehicle shopping increasingly occurs on the internet.
Read at Yahoo News
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