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The average sticker price for a new car, truck or SUV is close to $35,000, according to AAA. Used cars are increasingly expensive as well, selling for an average of about $27,000.
Those hefty prices make car buyers tempting targets for various types of scams.
Shady practices include car dealers slipping hidden charges and unwanted add-ons into a buyer’s total costs and private sellers misleading a purchaser about a car’s true mileage or accident history. There are also online crooks who will sell a vehicle that doesn’t even exist, then disappear with the buyer’s money.
Although the National Automobile Dealers Association has an ethics guide for the more than 16,000 new car dealers in its membership — with principles that include “treat each customer in a fair, open and honest manner” — Americans still lose billions of dollars each year to various car buying scams. That’s based on a Federal Trade Commission (FTC) estimate that its new Combating Auto Retail Scams (CARS) Rule, which takes effect July 30, 2024, could save U.S. consumers more than $3.4 billion a year by curbing many of the unethical tactics, such as bait-and-switch schemes, dealers use to lure vehicle buyers to their lots.
Unethical practices
Car dealerships have been known to use a variety of methods to get more money from buyers. A dealer might advertise a car at what looks like an attractive price to get you in the front door. But then, after you decide to purchase the vehicle, the dealer adds a series of questionable fees to cover such things as inspections, preparing the car or, if you’re buying a used car, reconditioning. Some might even double charge you for services that were included in the advertised purchase price.
In one 2022 case, the FTC alleged that a Washington, D.C.–area dealer had jacked up the advertised price of a Nissan SUV by nearly $2,400. (The FTC eventually obtained more than $3.3 million in refunds for customers.)
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