FTC Pricing Rules for Dealerships - Price Badging on AutoTrader and KBB Paused

[Jeff Kershner]

AutoTrader and KBB (Cox Automotive) have paused thier Good/Great consumer facing price badging feature due to governement pressure and the FTC warning 97 dealer groups in March citing advertised prices must include all mandatory fees. TrueCar, Cars.com, and CarGurus have also updated their platforms in response to FTC pricing pressure.

Cox Automotive has temporarily paused Good and Great price badges on Autotrader and Kelley Blue Book listings amid increased FTC enforcement activity around pricing transparency. As a result, the company also disabled Fair Market Range price badging inside vAuto’s vehicle workbook.

The changes took effect May 13, according to an internal notice sent to dealers. The pause was intended “to support a consistent experience across Cox Automotive solutions during a period of industry transition,” the notice stated. -source

In response to the pressure, AutoTrader and KBB have now lauched an DEALER FEES INCLUDED Badge - to help consumers and dealers identify vehicles with fee-inclusive pricing.

Cox isn't alone in retooling its badging feature. TrueCar moved to fold dealer fees into upfront pricing ahead of any enforcement action. Cars.com are providing dealers the option to show customers a total price reflecting all dealer fees and charges, along with an itemization of those fees and CarGurus built a feed-based tool dealers can use to itemize fees contributing to their all-in price. Dealers have also been scrambing to figure out ways to show their added dealer fees into their displayed TOTAL PRICING structure.

Most dealers, if they were not already have added a Document Fees field into their displayed pricing structure. However, a quick search online and it's obvious many dealerships have either NOT been paying attention to the news OR they're simply taking the risk at not being caught. Which is it?

How have you adjusted your pricing structure to abide by the new FTC rules?

 

[Jeff Kershner]

We've been discussing this in the forums for sometime now:

PR & News - FTC Proposed Rules for Dealers’ websites, F&I offices

The FTC has proposed new regulations that would ban F&I and vehicle add-on products deemed to provide "no benefit," require dealers to list prices online, and expand disclosure requirements—measures the industry views as restrictive and burdensome. Key concerns raised include stricter...

forum.dealerrefresh.com

FTC CARS Act Questions

Automotive dealers discuss the FTC's CARS Rule (Combating Auto Retail Scams Trade Regulation Rule), with a forum member preparing to meet with the FTC's Director of Financial Practices to advocate for industry concerns. The thread covers Florida's independent enforcement efforts against...

forum.dealerrefresh.com

Something that seems relevant.

The thread discusses an FTC proposal to ban junk fees and bait-and-switch tactics in car sales, with dealers debating whether the regulations are necessary and effective. While participants acknowledge that some dealerships use deceptive pricing practices with significant gaps between advertised...

forum.dealerrefresh.com

We even had Tom Kline on the RefreshFriday podcast a few times to discuss:

#RefreshFriday - Ready for FTC Safeguards & Gramm-Leach-Bliley on June 9th? | Tom Kline

This RefreshFriday webcast features compliance expert Tom Kline discussing FTC Safeguards and Gramm-Leach-Bliley Act requirements taking effect June 9th, covering critical areas like website vehicle pricing, digital retailing payment disclosures, lead data handling, and customer communication...

forum.dealerrefresh.com

#RefreshFriday - FTC Rules - More Ammo To Get Ready | Tom Kline of Better Vantage Point

DealerRefresh hosted a webcast with Tom Kline of Better Vantage Point to discuss the FTC's CARS Rule (Combating Auto Retail Scams), which targets deceptive dealer practices like bait-and-switch tactics and hidden charges, with an enforcement deadline in July. The thread reveals significant...

forum.dealerrefresh.com

#RefreshFriday - The NEW FTC Rules ...Have Been Extended | Tom Kline

The FTC Safeguard Rules implementation has been delayed by six months, giving dealers additional time to prepare for compliance. Tom Kline discusses what these new rules entail and provides clarity on the specific requirements dealers must meet to come into compliance during the extended timeline.

forum.dealerrefresh.com

If you have a question around FTC guidelines, ask TOM!

 

[The QR Code Guy]

One interesting takeaway here is that the major vendors (and us small guys too appear to be taking pricing transparency very seriously.

AutoTrader, KBB, Cars.com, CarGurus, TrueCar, and others are all making changes to help consumers better understand what they’ll actually pay and to help dealers present pricing more consistently.

Whether you agree with the FTC’s approach or not, it’s clear that the marketplace is moving toward greater transparency.

The bigger question for dealers isn’t whether AutoTrader adds a badge or Cars.com changes a display field. It’s whether the pricing shown on those platforms matches what’s on the dealership website, the VDP, the monthly specials page, and ultimately the price a customer is presented in-store.

The vendors are doing their part to create more transparency. The opportunity for dealers is to make sure their internal pricing and merchandising processes can keep pace.

Transparency isn’t really a website feature—it’s an operational discipline.