America’s Federal Trade Commission is under pressure to introduce consumer protection measures that supporters says will stop car buyers being ripped off by dealers, but which dealers claim will only make cars more expensive.
Exactly a year ago the FTC announced plans to make the business of buying a car more transparent by clamping down on bait-and-switch advertisements, banning ‘junk’ fees and forcing dealers to show customers a true transaction price with the cost of all add-on products included. The FTC said at the time that the proposed measures would “save consumers time and money and help ensure a level playing field for honest dealers.”
Twelve months on, the FTC still hasn’t implemented any changes and this week a group of 17 Democratic lawmakers urged the body to pull its regulatory finger, calling on the FTC to “adopt strong regulatory protections for car buyers,” Reuters reports.
Related: FTC Continues To Put Pressure On Shady Dealer Bait And Switch Fees With New Proposal
Not all politicians are as enthusiastic about the potential regulations. Last fall a group of Republican senators claimed the proposed FTC measures would “confuse customers, lengthen the transaction time to purchase a vehicle, limit consumer choice, increase paperwork, and mandate burdensome new recordkeeping requirements,” according to Reuters.
And unsurprisingly, the auto industry agrees, warning that micromanagement of the buying process would harm both consumers, car dealers and automakers. Both sides have come up with figures to support their argument, and they vary wildly. While the FTC estimates that its proposals would be worth $29.7 billion to consumers over the course of a decade, another study carried out by the Center for Automotive Research on behalf of the National Automobile Dealers Association suggested that the planned rules would actually cost buyers $38.1 billion over the same 10-year period.
We can understand that dealers don’t want to be hit with more admin, or measures that might cost them some opportunities to make money. But why don’t consumers deserve the same kind of transparency when buying a car that they expect when paying for a pair of Nike sneakers or a new Apple laptop?