Home » The U.S. Government Is Trying To Crack Down On Shady Dealership Tactics

The U.S. Government Is Trying To Crack Down On Shady Dealership Tactics

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The FTC clamps down on shady dealership tactics, Nissan issues a hood recall, Rivian takes Level 3 charging off the beaten path. All this and more on today’s issue of The Morning Dump.

Welcome to The Morning Dump, bite-sized stories corralled into a single article for your morning perusal. If your morning coffee’s working a little too well, pull up a throne and have a gander at the best of the rest of yesterday.

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F&I, Meet FTC

Car Dealership
Photo credit: “Row of Cars at a Car Dealership” by everycar_listed_photos is marked with CC BY-SA 2.0.

A typical guideline with any new car dealership is that no matter how nice your sales guy is, the finance and insurance (F&I) office is going to try to make you bend over by pushing high-margin drivel like dentless paint removal and TruCoat. While some F&I add-ons have value, like tire and wheel protection if you live in an area with awful roads or gap insurance if you’re going in with negative equity, most are just designed to squeeze more money from your wallet.

After what feels like a lifetime of seedy F&I tactics, the Federal Trade Commission is aiming to come down on dealership F&I departments pushing bogus add-ons. In a notice approved 4-1, the Commission is looking to do four things. First, establish rules that prevent consumers from being baited by dealership tricks like ineligible discounts and vehicles advertised but not available. Second, ban bullshit like charges for nitrogen-filled tires. I mean come on, air is already around 78 percent nitrogen, and most dealership service departments are in no way qualified or equipped to actually perform a superior nitrogen fill of a tire. Third, ban surprise fees for add-ons. Nobody likes to be whacked with charges that weren’t included in the original sticker price. Finally, establish upfront dealership pricing regulations so consumers can know exactly how much a car costs excluding tax and government fees. Here it is from the FTC itself:

  • Ban bait-and-switch claims: The proposal would prohibit dealers from making a number of deceptive advertising claims to lure in prospective car buyers. This deal deception can include the cost of a vehicle or the terms of financing, the cost of any add-on products or services, whether financing terms are for a lease, the availability of any discounts or rebates, the actual availability of the vehicles being advertised, and whether a financing deal has been finalized, among other areas. Once in the door or on the hook, consumers face the fallout of false promises that don’t pan out.

 

  • Ban fraudulent junk fees:  The proposal would prohibit dealers from charging consumers junk fees for fraudulent add-on products and services that provide no benefit to the consumer (including “nitrogen filled” tires that contain no more nitrogen than normal air).

 

  • Ban surprise junk fees: The proposal would prohibit dealers from charging consumers for an add-on without their clear, written consent and would require dealers to inform consumers about the price of the car without any of optional add-ons.

 

  • Require full upfront disclosure of costs and conditions: The proposal would require dealers to make key disclosures to consumers, including providing a true “offering price” for a vehicle that would be full price a consumer would pay, excluding only taxes and government fees. It would also require dealers to make disclosures about optional add-on fees, including their price and the fact that they are not required as a condition of purchasing or leasing the vehicle, along with disclosures to consumers with key information about financing terms.

All in all, some very fair goals, and the FTC actually seems eager to reach them. In a statement issued Thursday, Samuel Levine, Director of the FTC’s Bureau of Consumer Protection, said, “As auto prices surge, the Commission is taking comprehensive action to prohibit junk fees, bait-and-switch advertising, and other practices that hit consumers’ pocketbooks.” While protections like these are already in place in many states, federal protections will give consumers an extra coat of armor and bring out bigger pitchforks for offending dealerships. Let’s hope that things progress on this front sooner rather than later for the sake of making each dealership less of a battlefield for consumers.

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Nissan Has Hood Problems

2014 Nissan Pathfinder Hybrid 1
Photo credit: Nissan

You know what everyone loves? A good hood that doesn’t fly up while you’re driving. Unfortunately, not every car has a hood that stays put forever, so Nissan’s recalled 360,379 2013 to 2016 Pathfinder crossovers for, erm, unexpected active aero. Let’s break down exactly what’s going on.

See, cars in North America have both primary and secondary hood latches to prevent any moving bodywork shenanigans. The idea is that even if the primary latch is popped, the secondary latch will keep things together like buttercream frosting. Secondary latches are typically some sort of bell crank arrangement that you have to find with your hands under the “popped” hood, though sometimes automakers use the same hood release lever in the car to pop both the primary and secondary latches via a cable (this requires two pulls). In the case of the Nissan Pathfinder, the secondary latch is a bellcrank type, and it’s a buildup of debris on its pivot point that can cause bodywork to fly. While this seems like an issue that can happen to any car,

If hood latch failure isn’t surprising enough, Nissan expects owners to implement one arm of this recall fix. While 40,000 owners will get brand new latch assemblies, everyone else affected will get mailed a letter with inspection instructions. According to the recall report, “If the levers move freely, the owner can clean and condition the lever per the Owner’s Manual general maintenance requirements in Section 8 “Maintenance and DIY.” While the recall report later states that hood latch cleaning can be done by dealerships and that properly bad hood latches will be replaced, the image of telling owners to get a can of white lithium grease and sort their shit out seems preposterous to picture.

Adding to the general weirdness of this whole situation, this isn’t even the first time the old Pathfinder’s been recalled for hood latch problems. In 2015, Nissan recalled model year 2013 and 2014 Pathfinders for another hood latch issue, this time for a cable that was a bit too short. Anyway, this latest recall affects 322,671 Pathfinders in America, 37,115 in Canada, and 593 in Korea. Owners in America are expected to be notified by Aug. 3, so I’d recommend leaving Pathfinders a touch more room on the road until then.

Rivian Opens Off-Road Charging Stations

Rivian Off Road
Photo credit: Rivian

It’s no secret that electric vehicles have a ton of potential for off-roading. I mean come on, between awesome low-speed torque, potential four-motor applications for sending power to wheels with traction, and the prospect of a quieter four-wheeling experience, there’s some awesome potential here. However, off-roading also amplifies the big weakness of EVs – the charging network.

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Sure, several manufacturers have promised to put charging stations near national parks and off-road trails, but plans have either only incorporated Level 2 charging or seemed a bit far-fetched. Happily, Rivian actually seems to be making progress, opening a Level 3 charging station in Salida, Colo. on Monday. Honestly, Salida seems to be a dope spot for mountain biking, skiing, and high-elevation hiking, so I totally get how this decision was reached. What’s more, the charging station in Salida is one of three stations on Rivian’s Adventure Network opening this week. Two more opening in Inyokern and Bishop, Calif. should be perfect for those who want to see the Sequoia National Forest, Mammoth Lakes, Death Valley, and so many more cool spots near the border with Nevada.

Trent Warnke, Rivian’s Senior Director of Energy and Charging solutions seems pretty stoked. In a statement issued Monday, Warnke said, “We designed Rivian charging to support electrified adventure, and these first sites demonstrate how we’re enabling drivers to responsibly reach some of the nation’s most breathtaking natural spaces.” In fact, Rivian hopes to roll out some 600 chargers on its Adventure Network, so expect to see more EVs out in the wilderness soon. Personally, I can’t wait.

J.D. Power Is Back On Their Bullshit

F-150 Lightning at the Rouge Electric Vehicle Center
Photo credit Ford

There’s definitely a value in reading beyond headlines. For instance, J.D. Power’s Initial Quality Study has sailed to a record high average of 180 problems per 100 vehicles, which the firm views as a sign that quality is slipping. Without much critical thought, it’s an easy statistic to eat up, although any deeper pondering will smash that belief to smithereens.

I mean come on, what the hell is initial quality? Unless something falls off leaving the dealer lot, shouldn’t everything have decent initial quality? See, J.D. Power measures initial quality by counting any and all consumer complaints, then weighting them equally. Some Luddite not being able to figure out their new dome light is logged as the same sort of complaint as a blown engine. While it’s a great system for determining user-friendliness, it’s a bad system for logging quality.

However, what this does tell us is that vehicles are getting more complicated and harder to figure out than ever before. While a base-model compact car in 1990 offered such standard luxuries as seats, windows, and all the air inside the vehicle, a new compact car comes with infotainment, automatic emergency braking, and all sorts of other words that would have been the stuff of science fiction 30 or 40 years ago. As such, I propose and industry-wide test to measure user-friendliness. Get a car up to 70 mph, then have the driver change the cabin temperature, switch playlists on the stereo, and turn on the heated steering wheel. If changing all these settings takes more than three seconds, the user interface is too complicated. I reckon that a whole bunch of infotainment systems will need to go back to the drawing board to pass that test.

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The Flush

Whelp, time to drop the lid on today’s edition of The Morning Dump. Happy Wednesday, everyone. We’re halfway through the week! You know, this J.D. Power story poses a good question. What’s one feature in new cars that you absolutely adore, and one feature in new cars that makes you want to aim for the nearest lamppost? For me, I absolutely love gesture control. It’s a total gimmick, but it makes any driver feel like they have Matilda’s magic powers, and that’s pretty dope. As for a feature I hate, wireless phone mirroring without wireless charging can fuck right off. Come on, a Qi pad isn’t that expensive, don’t make me bring my own gear that could fly haphazardly about the cabin should I attack an on-ramp with zeal.

Lead photo credit: yonkershonda licensed under CC BY-SA 2.0

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Defenestrator
Defenestrator
1 year ago

Great features:
Wireless Android Auto. I expected it to be finicky compared to wired, but it actually worked really smoothly.
Backup cameras. Some people call them a crutch, but no amount of driving experience will let you see through the rear of the car.

Not so great: lane keep assist and auto-brake. Good in theory, but the practice leaves something to be desired. I’ve found Chevy’s LKA intervenes gently and only as needed. I guess it’s not terribly useful since it gives up so easily, but at least it’s not intrusive. The rental Ford I had tried to run me into the cones in a construction zone, then later tried to get me rear-ended on the highway with phantom braking. At least it was easy to disable.

Dave Horchak
Dave Horchak
1 year ago

Definitely needs done in Pennsylvania especially Pittsburgh. They always have a large print great price then in very little print says after a $4000 trade or down payment.

Ivan256
Ivan256
1 year ago

A crackdown on shady dealerships is welcome, but the proposals here are typical ineffective politician bullshit. The cynic in me thinks that’s completely on purpose. Now you can tell your constituents you “did something” and also tell the dealer lobby that they got off with extra fast-talk at the end of their ad.

Want to really crack down on shady dealerships? End dealer monopolies by allowing grey market imports, ban regional franchise exclusivity agreements, and ban loan initiation payments from financial institutions to dealerships.

Chris Savino
Chris Savino
1 year ago

It’s shady to ask if customers want add on crap? I simply say “no thank you”. Seems like a lot of hot air to me.

3WiperB
3WiperB
1 year ago

Features I love on my RAM 1500
– Surround view cameras/parking sensors (it’s a huge vehicle and it helps me navigate in tight spaces)
– Automatic braking in reverse
– Automatic wipers
– Air suspension
– Automatic adjustment of length for blind spot monitoring when towing a trailer
– TPMS monitors for my trailer
– The E-torque system makes transmission shifts in the truck the smoothest of any vehicle I’ve ever had. It also makes the stop start so much less annoying (still a little annoying) than any other car I’ve had.

Gimmicky features that are kind of stupid
– Self Parking (it only works if there are cars detected on either side)

Features I hoped would be great and ended up sucking
– Reverse trailer steering (it requires calibration every time it’s used, which involves driving forward and turning a few times. So if I don’t calibrate it before using it, it doesn’t work)

The infotainment in the RAM is one of the best I have used, and it at least has a few quick shortcuts that are programmable, so I can have button always on the screen for things like turning on the surround cameras (great for parking when going forward). They do bury the heated wheel, seat heat and cooling, and even the climate control “off” button in the infotainment though, and that’s what I wish had real buttons. At least they are all only 2 button clicks in, and the heated wheel and seat heat/cooling pop up on the screen for a moment when starting the car, and also can be configured to be automatic based on temperature.

Jason Hinton
Jason Hinton
1 year ago

New features I like:
I would say CarPlay / Android Auto but those are at least a decade old now. The best new feature I’ve had in rentals and now my Bolt is 360 cameras. They are fantastic for those of use that live in cities and do a lot of tight parking.

Features that bug me:
Center console gear gear shifters on automatic cars. Why do I have this big lever sticking out of the center console taking up space better used for cup holders and storage? They replaced column shifters decades ago because stylist thought they looked cool and sporty by imitating a manual shifter. It didn’t fool anyone then and they are still a waste of space today. If it is a cable shifter column shift is the way to go. If it is electronic shifter give me a rotary shift knob – simple, intuitive, compact.

Ypsituckian
Ypsituckian
1 year ago

Please send an Army of FTC Paratroopers to Florida. And whatever happened to “Sherman Anti-Trust”? Only a few Family Corporations own all the Southern Dealers who price-fix and collude.

Iwannadrive637
Iwannadrive637
1 year ago

Back up cameras are a Godsend. I actually like the lane keeping assist on my Mustang. No chimes or buzzers, and the car doesn’t try to correct my steering. It just sends a vibration through the wheel like I’m running over rumble strips. Engine start/stop that can’t be turned off is pure evil.

Sandshadow
Sandshadow
1 year ago

Well, I have a CX-5 subject to the “KUOW Bug”, which Mercedes covered on the J site.
https://jalopnik.com/a-weird-radio-glitch-has-mazda-owners-stuck-listening-t-1848506850
For some people, their radio gets stuck on the NPR station that broadcast images without file extensions. In my case the impact is worse and the infotainment center continually restarts, so we have no navigation, no music, no phone connectivity, no backup camera, no way to access the maintenance app. So my complaint is with computers in cars that have no provisions to update the firmware.
I’m getting a model 3 and want to sell the CX-5, but obviously can’t until we get the ($1500) computer replaced. We’re number 8 in line at our dealership, but that hasn’t changed in over 2 months.

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