The Federal Trade Commission (FTC) has taken a significant step in its ongoing scrutiny of automotive retail advertising, issuing warning letters to 97 dealership groups nationwide regarding what it characterizes as potentially deceptive pricing practices.
While not every dealer received a letter, the implication for the broader market is unmistakable: regulators are actively evaluating how vehicle prices are presented to consumers—particularly where mandatory fees or add-ons are excluded from advertised pricing.
The FTC’s position centers on a longstanding but increasingly enforced principle: advertised prices should reflect the actual price a consumer is expected to pay. Practices that advertise a base price but later require consumers to pay additional, unavoidable charges—such as dealer-installed products or protection packages—are drawing heightened scrutiny.
This development aligns with the FTC’s broader regulatory posture following the proposed CARS Rule and its continued emphasis on eliminating what it views as “junk fees” and misleading advertising tactics across industries.
In response to the warning letters, the National Automobile Dealers Association (NADA) has moved quickly to engage with regulators and provide guidance to its members. NADA will host a timely and high-level webinar featuring both industry and regulatory leadership:
- Helen Clark, Assistant Director, Division of Financial Practices, FTC
- Brian Bennett, Counsel and Director of Regulatory Affairs, NADA
Monday, April 6 | 1:00 – 2:00 PM ET
This session represents a rare opportunity for dealers to hear directly from a senior FTC official about the intent behind the warning letters and the agency’s expectations moving forward. NADA has positioned the webinar as a practical, compliance-focused discussion aimed at helping dealers adapt in real time.
Since the FTC’s announcement on March 13, early industry reaction has centered on risk mitigation and operational adjustments. Many dealer groups—particularly larger, multi-rooftop organizations—are already reevaluating their advertising strategies.
Key trends emerging include:
- Increased inclusion of mandatory add-ons in advertised pricing
- Greater internal legal/compliance review of marketing materials
- Heightened coordination between variable operations and marketing teams
- Reassessment of third-party lead provider pricing displays
There is also growing recognition that inconsistent practices across rooftops or platforms may increase exposure, even for otherwise compliant dealers.
Until further clarity is provided, the most prudent course of action is straightforward:
Ensure that advertised vehicle prices include all mandatory fees and charges, including the dealer processing charge. Only government-imposed costs such as taxes, title, and registration may be excluded.
This approach aligns most closely with the FTC’s current posture and materially reduces the likelihood of regulatory scrutiny during this period of active enforcement.
Dealers should also:
- Audit current website and third-party listings
- Review disclaimers for clarity and prominence
- Coordinate with OEM program requirements where applicable
- Consult legal or compliance advisors on edge cases
The FTC’s warning letters do not establish new law, but they do signal a more aggressive enforcement environment. How this ultimately evolves—whether through formal rulemaking, enforcement actions, or negotiated industry standards—remains to be seen.
In the interim, proactive compliance and pricing transparency will be essential.
WANADA will continue to monitor developments closely, maintain communication with NADA leadership, and keep members informed as additional guidance becomes available following the April 6 webinar.
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