What’s new: On Monday, the Center for Automotive Research (CAR) issued an updated study assessing the costs and impacts associated with the Federal Trade Commission’s (FTC) Vehicle Shopping Rule (or “CARS” Rule) following the final rule’s release on January 4, 2024.
Automotive News covered the updated report in their June 3 article, “FTC regs will still cost dealers money, consumers time — just less than originally thought, NADA-backed study finds.”
Why it matters: The Vehicle Shopping Rule is simply terrible for consumers. It will add massive amounts of time, complexity, paperwork and cost to car buying and car shopping for tens of millions of Americans every year
Tell me more: According to CAR’s estimations, the Final Rule would:
- Require at least an additional hour to complete the vehicle purchasing process (divided between the sales process and the review of financial disclosures and documentation),
- Generate a net cost to consumers and dealers of $24.1 billion over 10 years,
- Impose upon each dealership location average upfront compliance costs of $31,450, and average recurring annual cost of $39,862.
What’s next: The rule had an initial effective date of July 30, 2024, for dealers to comply. But on Jan. 18, 2024, the FTC delayed the rule’s implementation by granting a stay order
NADA continues to challenge the rule in court and supports federal legislation that would prevent the FTC from implementing or enforcing this ill-conceived rule.
Go deeper: The full CAR study is available here.