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BBB: Don't deduct lease rebate from vehicle's advertised price

May 25, 2012
The Better Business Bureau-Chicago reports seeing a recent trend concerning prices advertised for lease vehicles by dealers. In its role in monitoring dealer advertising, the office has sent several letters to dealers concerning the deduction of lease rebates from advertised prices.
 
Lease rebates are available to all customers who lease vehicles. However, those customers who purchase the same vehicles cannot get the advertised prices because they buy rather than lease. 
 
“While lease rebates are available to all customers who lease, the rebates are actually limited rebates because they are only available to lease customers,” said BBB senior counsel Patricia Kelly. “Purchasers cannot obtain the rebates. Since the rebates are limited to only certain customers they cannot be deducted from advertised prices of vehicles.”
 
The BBB-CATA Advertising Review Program, begun in 1996, can help dealers avoid a suit. The BBB reviews dealer ads and sends a dealer notice of a rule infraction. If a dealer fails to shore up the ad within 30 days, the BBB forwards the matter to the attorney general’s office.
 
The BBB efforts also strive to maintain a level playing field for dealers to advertise prices, and to help consumers understand price offers.
 
Other common advertising  faults cited by the BBB:
 
Clear and conspicuous disclosure of material terms. Disclosures at the end of some radio spots are spoken too quickly and/or too quietly. Related to that, Kelly said listeners can’t simply be directed to a website to review the disclosures because a claim can’t be made in one forum but its disclosures made in another.
 
Internet pricing. It is a violation to list different selling prices for a vehicle in different media; it must be the same in all.
 
‘Guaranteed lowest price.’ To make such a claim, the dealer must systematically monitor competitive prices in the trade area. “In order to say you have the lowest price,” said Kelly, “you really have to be the lowest.”
 
Clearance sale. The word cannot be used arbitrarily. It applies only when a vehicle model can no longer be ordered from the factory.
 
No-haggle prices. A dealership either haggles or it doesn’t. “You can’t negotiate sometimes and not negotiate other times,” said Kelly.
 
Consumer Fraud Act. Bad: “We will pay off your loan.” Better: “We will build your old loan into a new loan.”
 
The BBB is prepared to review dealer ads before they go public. For consideration, contact Jorge Garcia at jgarcia@chicago.bbb.org or (312) 832-9193.
 
 

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