if available to 100% of consumers. If a consumer chooses the lower APR, that consumer’s purchase price would differ from the price that includes the rebate. If you do want to advertise the cash rebate as an option for customer savings, you could do so after advertising the more prominent “total price.” ESTABLISH A COMPLIANT DISCLOSURE PROCESS Never forget that a dealership is considered legally responsible for its advertisements. It does not matter whether an ad comes from the manufacturer or a third-party agency; truly, the buck stops with the dealership. Good disclosure is not just about avoiding regulatory or legal trouble; it is a sales and reputation asset. Customers who feel they understand exactly what they are paying and why are more likely to complete the transaction, return for service, provide referrals and post positive reviews. To ensure compliance with the FTC’s “total price” guidelines, consider establishing a written policy on advertising. NADA has a Fair Pricing Compliance Guide, and many third-party vendors offer products and services to assist motor vehicle dealers with compliance. Of course, dealers should also retain knowledgeable legal counsel to review proposed advertisements. A 15-minute attorney review can be a wise investment. Train your sales team in what must be disclosed and how. Every salesperson and finance manager should be able to explain every line on the price disclosure document in plain English. Establish “bright line” rules for how price, incentives and voluntary protection products must be disclosed. We all appreciate the legal exposure created by a poorly run F&I department, regardless of our intent to operate a trustworthy operation for the public. Although not legally required, consider presenting the customer with a clear one-page summary before any financing discussion begins, showing: vehicle selling price, voluntary protection products purchased, all fees, all applicable taxes, all incentives applied and their conditions, and the resulting total out-of-pocket price. Have the customer sign or initial it. Audit your advertising regularly. Review all advertisements, including digital, broadcast, print and social media, to ensure that: (a) advertised prices reflect vehicles in your inventory, (b) all conditions on advertised prices and incentives are clearly stated, and (c) fine print does not contradict or undermine the total price. Update your processes when incentives change. Manufacturer incentive programs change monthly. Assign someone the responsibility of ensuring that pricing, advertising and sales team training are up to date with active programs. Make sure your third-party vendors are responsive to your requested changes and properly include the West Virginia documentary fee and mandatory add-ons in the total price. Review your add-on process. Make a list of every product or charge that appears in a typical transaction. For each, ask: Is this mandatory? If it is, it must be included in the total price. For optional charges, ensure they are clearly presented as such, with a clear opportunity to decline. TRANSPARENCY IS THE GOAL The underlying principle behind all pricing disclosure requirements is simple: Tell customers what they are paying for and why before they commit. Customers who feel informed and respected are your dealership’s best long-term asset. The dealerships facing regulatory action are, in almost every case, those that treated price transparency as an obstacle to closing deals rather than a foundation for building them. The ones with the strongest reputations — and the cleanest regulatory records — are those that have treated transparency as a competitive advantage, not a burden. Straight talk on price is not just the right approach from a compliance standpoint; it is the right approach for earning customer trust that will support your business for years to come. Remember, every dealer must follow these new advertising guidelines. I do appreciate that they represent a significant change in practice for our West Virginia dealers, but I am always impressed by the dealer body’s ability to adapt and implement new procedures effectively and appropriately. As always, your West Virginia Automobile Dealer Association and its team are ready and willing to assist you with this effort. WVADA NEWS 20
RkJQdWJsaXNoZXIy MTg3NDExNQ==