Beware of these questionable dealer tactics when buying a new car

ByNydia Han and Heather Grubola WPVI logo
Tuesday, August 23, 2022
Beware of these questionable dealer tactics when buying a new car
Buying a new or used car can be tricky and frustrating. Now the Federal Trade Commission is looking to protect buyers with some new rules.

PHILADELPHIA (WPVI) -- Buying a new or used car can be tricky and frustrating. Now the Federal Trade Commission is looking to protect buyers with some new rules.

Many consumers are complaining to the Troubleshooters about not just sticker shock but new, hidden fees. Until those new rules roll out Consumer Reports has some tips to avoid problems.

Have you ever left the car dealership with the promise of a great deal only to realize you were taken for a ride? You are not alone.

"The FTC received more than 100,000 complaints each year over the last three years about shady dealership practices. Now they're trying to put into place some protections to keep them from happening to consumers," said Keith Barry, a Consumer Reports auto expert.

Some of the practices the Federal Trade Commission would ban? Not disclosing the full price of a car to any consumer who asks.

"Until then, you're going to want to get as much information in writing from the dealer as possible. Ask for an itemized, out-the-door price," said Barry.

And also ask the cost of add-ons already installed on your car that's supposedly "the last one in stock."

"Under those new rules you wouldn't have to pay for those extras, but in the meantime, you're going to want to negotiate to get them taken off," said Barry.

Half a dealer's profit, about $1,200 for new cars, and about a third of the profits or $900 for used, comes from extra financing, leasing, and services fees.

"At the end of the whole process, check the paperwork, check the math. If there is an extra that you want to buy, negotiate the price on that, and don't fall for unnecessary extras," said Barry.

Extra items like those nitrogen-filled tires. CR has seen charges as high as $495, even though one company says dealers should charge only $8 to $12 for a fill.

CR recommends skipping nitrogen altogether, no matter the price.

And beware if you're told there was a mistake and your car was sold and the more expensive one is the only vehicle left.

"It's the classic bait and switch. In some states it's illegal, and it's at the very least an unfair trade practice. So this is your sign it is time to walk away," said Barry.

CR says if you feel you've been wronged by a dealership, complain, complain, complain.

Meantime, automobile dealer associations say the proposed FTC rules are complicated, and could negatively impact their businesses.

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