www.GADA.com | 101 Dealer Cost/Dealer Invoice/Dead Cost Offers It is deceptive and misleading practice and a violation of the Fair Business Practices Act to advertise the terms “dealer cost,” “cost,” “dealer invoice,” or terms of a similar import unless the term is fully explained in immediate proximity to the claim. The vehicle must be sold for the actual net cost that the dealer paid, less any dealer holdbacks, dealer factory rebates, or incentives, and not including overhead expenses or profit. Only tax, tag, title, and Georgia Lemon Law fees may be added. The terms “dealer cost,” “dealer invoice,” and similar terms do not refer to universal or standard documents in the industry, and therefore, these terms should not be used to advertise vehicles, unless it is disclosed in immediate proximity to the offer what is included in the advertised price. Dealer installed options on vehicles included in a “dealer invoice” sale must be sold at the dealer’s actual documented internal cost. Options installed at the request of the customer following contact/negotiation with the dealership may be sold at prices other than the dealer’s actual documented internal cost. Lifetime Warranties If an advertisement uses “lifetime,” “life,” or similar representations to describe the duration of a warranty or guarantee, then the advertisement should disclose, with such clarity and prominence as will be noticed and understood by prospective purchasers, the life to which the representation refers.19 It is important to note that businesses that advertise lifetime warranties on goods and thereafter go out of business may not be relieved of responsibility to honor those warranties. “Money-Back” Guarantees A seller may use the terms “Money Back Guarantee,” “Satisfaction Guaranteed,” “Risk-Free Trial,” or similar representations only if the seller refunds the full purchase price of the product at the buyer’s request, and clearly and conspicuously discloses any conditions or limitations in the advertisement. “Number One Volume Dealer” or “Largest Dealer” Claims Use of terms such as “Number One,” “#1,” “Largest,” “Biggest,” or similar terms are considered to represent vehicle retail sales volume (total number of vehicles). The source for the claim, including, but not limited to, time frame and category, must be disclosed in immediate proximity to the claim. These claims should not be made unless the dealer can substantiate the claim with documentation from the manufacturer, distributor, or some other independent and reliable source. Price Matching/Price Equaling Offers Use of terms such as “guaranteed lowest prices,” “we’ll beat any deal,” “we’ll match your best offer,” “we won’t be undersold,” or similar terms must include clear and conspicuous disclosure of all conditions or limitations on the offer. “We’ll beat any advertised price” is an acceptable offer. The consumer may be required to produce a competing dealer’s advertisement in order to substantiate a claim of a lower offer. However, such offers shall not require the presentation of any evidence which places an unreasonable burden on the consumer or the competing dealer. Examples of unfair requirements include, but are not limited to: 1. Requiring the consumer to produce a signed buyer’s order or contract; 2. Requiring that the consumer pay a deposit to the competing dealer; 3. Requiring a competing dealer to sell the vehicle to the advertising dealer; or 4. Requiring the production of a written offer from a competing dealer. “New”/“Demo” Vehicles “New” Vehicles: It is deceptive to advertise or represent a vehicle as “new” if it is not new for any of the following reasons without affirmatively disclosing the nonconformity in writing to the customer: 1. Vehicle has been previously titled; or 2. Vehicle has been previously sold or leased to a retail customer. These disclosures should be made regardless of whether or not a title application has been made on such vehicles, and notwithstanding the issuance or correction of a title to designate the vehicle as “new” for titling purposes. 19 16 C.F.R. § 239.4 (2007).
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