On October 8, 2026, the FTC announced a proposed settlement with an auto dealership group to resolve allegations that the dealerships advertised vehicle prices thousands of dollars below what consumers actually paid and used misleading prize promotions to attract customers. The FTC filed its complaint and proposed stipulated order in the U.S. District Court for the Middle District of Florida, alleging deceptive practices in violation of Section 5 of the Federal Trade Commission Act.
According to the complaint, the dealership group allegedly misrepresented vehicle prices by imposing additional mandatory charges and advertising discounts that were not available to all consumers. Specifically, the FTC alleged that the dealerships:
- Excluded mandatory fees from advertised prices. The dealerships allegedly charged consumers an average of more than $3,350 above advertised prices in over 92% of transactions through additional administrative, delivery, processing, and other fees.
- Advertised conditional discounts. Certain advertised prices allegedly included rebates and discounts available only to a subset of consumers, making the advertised prices unavailable to many purchasers.
- Used misleading prize promotions. The dealerships allegedly sent mailers representing that consumers had won thousands of dollars in cash prizes redeemable at dealerships, although the advertised prizes were not real.
- Continued misleading advertising after receiving an FTC warning. Following a March 2026 warning letter, the dealerships allegedly added false assurances of pricing transparency to their websites while continuing to advertise vehicles below their actual prices.
Under the proposed order, the dealerships would be required to prominently disclose the total price consumers must pay, excluding only required government charges. The order would also prohibit misrepresentations concerning vehicle pricing, financing requirements, fees, and promotional incentives, and impose ongoing recordkeeping and compliance reporting obligations. The proposed order remains subject to court approval.
Putting It Into Practice:The settlement follows the FTC's March warning to 97 auto dealership groups regarding deceptive vehicle pricing (previously discussed here) and a separate August settlement involving allegedly unauthorized dealership fees (previously discussed here). The FTC's has been using its existing enforcement authority to address vehicle pricing practices following the withdrawal of its CARS Rule. Auto dealers should review advertised prices, mandatory fees, conditional discounts, and promotional materials to ensure consistency with actual transaction terms.
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