Received yesterday a warning from Mass State Auto Dealers regarding TrueCar advertising and the violations of the Attorney General regulations. See below:
There is now an additional wrinkle to TrueCar’s relationship with Massachusetts
dealers – vehicle price advertisements. These advertisements include text, for
example, that put consumers on notice that Dealer X has the consumer’s vehicle
at some amount “below invoice”. Under the Massachusetts Attorney General’s
regulations, dealers may not use terms such as “dealer’s cost”, “wholesale”,
“invoice price”, “factory billing” or other similar terms unless the cost or
price standard represents the total consideration paid by the dealer to the
manufacturer, where no hold back or rebate has been or will be paid and the
advertisement discloses the exact figure of the standard. Plus, if advertising
price, the advertisement must include all charges necessary or usual prior to
delivery (e.g. freight, handling, vehicle prep, and documentary prep.) Under
the AG’s advertising regulations there are a number of other requirements that
apply concerning terminology and font size, which have been discussed in other
bulletins and educational materials made available to dealers in recent
years.The TrueCar price advertisements have dealers' names attached to
them with the prohibited language. Such third-party vendor agreements that you
may have executed do not excuse you from potential liability, and it can be
rather expensive as the last round of AG advertising enforcements proved.
It appears that TrueCar's existence in its current form is limited.
There is now an additional wrinkle to TrueCar’s relationship with Massachusetts
dealers – vehicle price advertisements. These advertisements include text, for
example, that put consumers on notice that Dealer X has the consumer’s vehicle
at some amount “below invoice”. Under the Massachusetts Attorney General’s
regulations, dealers may not use terms such as “dealer’s cost”, “wholesale”,
“invoice price”, “factory billing” or other similar terms unless the cost or
price standard represents the total consideration paid by the dealer to the
manufacturer, where no hold back or rebate has been or will be paid and the
advertisement discloses the exact figure of the standard. Plus, if advertising
price, the advertisement must include all charges necessary or usual prior to
delivery (e.g. freight, handling, vehicle prep, and documentary prep.) Under
the AG’s advertising regulations there are a number of other requirements that
apply concerning terminology and font size, which have been discussed in other
bulletins and educational materials made available to dealers in recent
years.The TrueCar price advertisements have dealers' names attached to
them with the prohibited language. Such third-party vendor agreements that you
may have executed do not excuse you from potential liability, and it can be
rather expensive as the last round of AG advertising enforcements proved.
It appears that TrueCar's existence in its current form is limited.
