On December 12, the Federal Trade Commission (FTC) published the long-awaited regulation specific to motor vehicle dealers to address concerns of consumer deception in the sales process (Final Rule). We covered the proposed rule, introduced in June 2022, in a blog post here and podcast here. In a 3-0 vote, the FTC approved the issuance of the Final Rule, which will be published in the Federal Register in the coming weeks.

The Final Rule, available here, is titled the Combating Auto Retail Scams (CARS) Rule, and, according to the FTC, targets bait-and-switch tactics and purported “junk fees.” “When Americans set out to buy a car, they’re routinely hit with unexpected and unnecessary fees that dealers extract just because they can,” said FTC Chair Lina M. Khan in a press release touting the new rule. “The CARS Rule will prohibit exploitative junk fees in the car-buying process, saving people time and money and protecting honest dealers.”

Absent an injunction, the CARS Rule will take effect on July 30, 2024, giving industry stakeholders limited time to prepare compliance strategies.