Automobile guide revisions provoke uproar
by Christopher Jensen, New York Times
Proposed changes to the used-car Buyers Guide required by the Federal Trade Commission have been criticized by consumer groups and the attorneys general of 22 states, who say the revisions would be a setback in consumer protection.
The critics are urging the F.T.C. not to adopt the changes ‘ the first since 1995 ‘ which they say could result in consumers’ being misled about their legal rights or not learning the full history of a car damaged in a flood or a crash.
The National Automobile Dealers Association, a trade group, took a different view. It told the agency that over all, the proposed revisions ‘represent an improvement for dealers and consumers.’
Since 1985, dealers have been required to post the Buyers Guide on the window of used vehicles. Its intent was to tell buyers whether the vehicle was covered by a warranty and to provide details of who would pay for repairs. The regulation does not apply to private sales.
In a news release, the F.T.C. said the changes were made to ’empower consumers without adding burdens to businesses.’
But in a letter last month, 14 consumer groups warned the F.T.C. that the changes would make ‘an antiquated, bad rule even worse.’ The groups included the Consumer Federation of America, the National Consumer Law Center, the United States Public Interest Research Group and Consumers for Auto Reliability and Safety.
‘We are extremely disappointed with where this rule-making stands,’ the Center for Auto Safety, another of the dissenters, noted in its letter.
The group of state attorneys general, including those from New York and Connecticut, was more direct, stating that one proposed change, involving vehicles being sold ‘as is’ without any warranty coverage, was so poorly worded that they would prefer to scrap the entire revised Buyers Guide.
In its current form, that section says: ‘The dealer assumes no responsibility for any repairs regardless of any oral statements about the vehicle.’ The proposed wording reads: ‘The dealer won’t pay for any repairs. The dealer is not responsible for any repairs, regardless of what anybody tells you.’
The phrase that is drawing protests is ‘regardless of what anybody tells you.’
The attorneys general are concerned that a dishonest or ill-informed dealer could more easily mislead consumers by saying ‘what anybody tells you’ is an indisputable statement of the law by the federal government.
However, the attorneys general group said, a dealer can be held responsible ‘for repairs to a vehicle if the dealer makes false statements to a consumer about the vehicle’s condition or title/damage history.’
The F.T.C. tried to make it easier to understand, but it got the law wrong, said William Brauch, a special assistant attorney general and director of the Consumer Protection Division in Iowa, one of the states protesting the change.
Charles Harwood, the acting director of the F.T.C.’s Bureau of Consumer Protection, said in a telephone interview that the comments from the consumer groups and attorneys general were ‘very useful’ and would be considered.
‘If it is not the right approach, fortunately the process would allow for us and allow for the commission to revisit the approach and think about a better way to do it,’ he said.
One thing consumer advocates and the attorneys general wanted, but didn’t get, was a requirement that dealers give consumers vehicle-history information to help check for incidents like theft or damage in a flood or crash.
California requires dealers to check the new federally backed National Motor Vehicle Title Information System and use a red warning sticker if there is a serious problem.
In comments filed with the F.T.C., many dealers objected, saying they worried about the accuracy of history reports and potential legal liability for providing incomplete information to buyers.
Instead of requiring dealers to provide vehicle histories, the F.T.C. is proposing a statement encouraging buyers to consider buying such vehicle histories. It would create an F.T.C. Web site for details.