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Dealer ad infractions seen lately reviewed

June 29, 2018
One area new-car dealer’s recent advertisement of a vehicle said that shoppers should "consult dealer for actual price." Another said "price does not include destination fees."
Both ads generated letters of admonishment to the dealers from the Better Business Bureau of Chicago and northern Illinois, which monitors dealer ads to make sure they comply with the state’s rules on motor vehicle advertising. The BBB acts as sort of a buffer between dealers and the Illinois attorney general’s office, although that office has complete and independent authority to handle all matters as it sees fit in light of enforcement priorities and resources.
Representatives of the BBB conducted a seminar at the CATA on June 26 to remind dealers and their advertisers what not to state in vehicle ads.
Both examples above run afoul of Section 475.310 of the ad regs, concerning Advertised Price. For the latter, only "taxes, license and title fees and a documentary service fee" may be excluded from a vehicle’s advertised price. For the former, well, where to start?
Indeed, improperly portraying a vehicle’s advertised price became such a common infraction that the CATA’s board of directors in 2014 authorized the BBB to treat it as one of five "Zero Tolerance" sins, conduct which the BBB refers to the AG’s office for appropriate enforcement.
Factoring into an advertised price any limited rebates for which all consumers don’t qualify is another common infraction, and it is another Zero Tolerance violation, of Section 475.530 of the rules. "The advertised price," said BBB legal counsel Patricia Kelly, who led the seminar, "must be available to everyone who sees the price."
Other recent dealer ads which generated BBB letters:
• "Free remote start and Nav!" (Violates Section 475.590, which bars gifts and free offers unless they are offered through a manufacturer’s program or a dealer advertising association.)
• "Internet price" (Cannot differ from price advertised in other media).
• "Sale price." "Is that a reduced price from an earlier price?" Kelly asked. That’s ‘was/is pricing,’ " a violation of Section 475.360(d) of the regulations.
• "Market value $28,800" on a used vehicle. "Where does that come from? Cite the source," Kelly said.
• Lifetime warranty/oil changes/car washes amount to gifts and free offers, which only can be offered through a manufacturer’s program or a dealer advertising association.
• Guaranteed trade-in amounts violate Section 475.540.
• Mailers that appear to have been issued by a government agency.
• "Key Exchange Event." Kelly said an exchange is evenhanded; consumers who buy a new vehicle likely will be paying more monthly for their new car than they did for their trade-in.
• "Liquidation sale." Said Kelly, "You can’t say that if you’re not leaving."
Correspondence via email represents "advertising" under the regulations, as do oral and other written and pictorial statements. The attorney general’s office does pursue actions against agencies that prepare dealer advertisements. Ultimately, dealerships are responsible for advertisements bearing their name.