CARS Column: Pricing disclosure requirement

May 13, 2024

By Barrie Charapp Beaty
Charapp & Weiss, LLP

In our previous articles on the CARS Rule, we discussed the FTC’s requirement that in advertising vehicles, the price must be the “offering price."

The “offering price” is the total cash price that you will sell or finance the vehicle only excluding required government charges. By that definition, the “offering price” would include the price of the vehicle as well as any other fees you charge such as the processing fee (if not mandated by your state) and electronic titling fee (if you use a 3rd party vendor and not a government entity). This article explores when the offering price should be disclosed to a consumer other than in an advertisement.

Under the CARS Rule, gone will be the days of discussing vehicle prices and terms with consumers in person should a consumer first reach out to a dealership in any fashion other than coming into the dealership. The Rule requires that in “any communication with a consumer that includes a reference, expressly or by implication, regarding a specific Vehicle," personnel must affirmatively disclose in their first response about the availability of that specific vehicle the offering price for the vehicle.

But what does that mean?
  • If a consumer calls the dealership to discuss a specific type of vehicle in inventory, the dealer personnel on the call must confirm availability of the vehicle and disclose the offering price for the vehicle in the first response to the call.
  • You cannot just schedule an appointment with the consumer to come in before disclosing that offering price.
  • If the communication is in writing to the dealer (i.e., by email), the availability of the vehicle must be confirmed and the offering price must be disclosed in writing. Thus, the Rule requires you to write them back (i.e., a response email) providing such information.  Do not call the consumer to make that disclosure.
  • If the consumer reaches out in an online chat, the availability must be confirmed and the offering price disclosed in that online chat.

Since the Rule is not yet in effect, the standard remains as you currently have been doing business. The goal of this column is to prepare you for the changes that will occur should the Rule go into effect, and not to upend your business when that time comes.