Consumer group alerts FTC that car buyers are facing unexpected fees due to misleading online listings.

Calls for Action on Car Pricing Transparency

Conservative groups are urging federal regulators to take stronger measures against misleading car pricing practices, indicating that many Americans could be losing significant amounts of money due to hidden fees when buying cars, according to reports.

The Bull Moose Project, an antitrust organization on the right, sent a letter to the Federal Trade Commission (FTC) commending recent actions against auto dealers while emphasizing that the problem has shifted online.

This comes after the FTC warned 97 dealership groups in March and reached a notable settlement with Lindsay Automotive, which revealed more than $75 million in overcharges and resulted in a fine of $3.1 million.

The letter pointed out that average markups from list prices to actual costs can be between 7% and 8%. So, a car priced at $40,000 might actually cost around $43,000 once all fees are included.

According to the group, the platform allows dealers to present incomplete pricing, often delaying the revelation of fees until consumers are further along in the buying process, when they may feel more committed to the purchase.

Aiden Buzzetti, the group’s founder, remarked that the core issue is the current lack of requirements for online platforms to show total prices, noting that different prices can appear on sites like Cars.com or AutoTrader.

He expressed concerns that deceptive practices persist across dealer websites and advertising on platforms where most consumers start their searches.

While some platforms, like Cars.com, claim to adhere to regulations, Buzzetti argues they could be doing more to ensure clarity, especially as car buying increasingly shifts to online spaces.

Although he praised the FTC’s actions against dealers, he pointed out that the online platforms involved are missing from the enforcement efforts. He’s advocating for “all-in pricing” regulations that ensure upfront prices represent the actual costs consumers will face.

Buzzetti believes changes to pricing standards on listing platforms are necessary, although he does not call for imposing direct liability on these companies, suggesting instead that they could improve their standards voluntarily.

However, he acknowledges that this deceptive pricing tactic has likely existed since the advent of online commerce, adding that better regulation would benefit American consumers.

Consumer protection lawyer Danny Caron noted that the issues raised reflect a broader trend in misleading pricing practices that regulators are still trying to tackle. He described the current state of affairs as deceptive and stressed that consumers should be cautious, as they may find that the price they see initially is different from what they’ll ultimately pay.

Citing similar practices in other industries, he attracted attention to the need for transparency in vehicle pricing. Despite the Bull Moose Project focusing on online platforms, Caron suggests regulators are currently concentrating more on dealerships themselves.

Ultimately, he cautioned consumers to be prepared for higher prices than they might expect during the buying process.

Amy Hunter Wright, VP of Communications for the National Automobile Dealers Association, echoed the call for clarity in vehicle pricing, indicating that they are actively working with various stakeholders to uphold advertising compliance in line with FTC recommendations.