Does A Texas Law Make It Illegal To Describe Vehicle Prices?
A controversy in Texas surrounds the right to describe the price of a used vehicle. In Texas, it’s against the law to make a claim of some sort of savings or declare a discount in the advertising of a used vehicle. There are many rules and regulations involved with being able to advertise the price of a new vehicle, however it’s very clear that, “a savings claim or discount offer may not be advertised on used motor vehicles.”
This isn’t a new regulation, however it’s interpretation is what is causing a headache for an organization and some dealerships in the state of Texas.
According to documents obtained by DrivingSales News, there was a letter sent from the Texas Department of Motor Vehicles Enforcement Division to CarGurus. CarGurus is a third-party provider of vehicle sales listings. In their vehicle listings they give the car shopper an idea of what kind of deal they could get if they make the purchase.
According to the letter from the state of Texas, CarGurus “…Currently advertises price drops and savings claims on the used vehicle inventory of Texas dealers in violation of 43 TEX. ADMIN. CODE § 215.262.” This is the state’s interpretation of the layout of the CarGurus site listings, that they are advertising of lower prices on used cars. The letter continued, “Texas dealers with offending advertisements on the CarGurus website are subject to disciplinary actions, including administrative penalties of up to $10,000.00 for each day a violation occurs for the above-listed violation.”
At this point, we know little more about this situation than what was shown in the letter. While we weren’t able to track down comment yet from the Texas DMV Enforcement Division, we received this statement from CarGurus.
That statement reads in part, “We are working closely with the Texas Department of Motor Vehicles on this issue right now, and we expect to have a resolution very soon. Once resolved, we will communicate immediately with our dealer customers in Texas. Â CarGurus helps millions of consumers shop for great car deals and connect with great local dealerships. We have partnered with many Texas dealerships and many thousands of dealers across the country, and we look forward to helping them grow their businesses even further.”
What do you make of this situation out of Texas? Who do you think is in the right? Is it a misinterpretation by the DMV or do they have it right this time? Whether or not you agree that the interpretation is correct, what do you make of the potential punishment for dealers?
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Jim, hopefully, your comment is in place just how you intended it to be. Thanks for the feedback about this story! We will actually have on update on this topic early next week.
I hope it is the dealers in Texas who brought this to the attention of the DPS (not DMV).
Cargurus is cut from the same horrendous cloth as Carfax. They take it upon themselves to “rate” a dealers pricing on vehicles he has listed on his own website- after they put these vehicles on their website. I don’t need someone to ‘grade’ us on our pricing. Specially when they don’t book them out with the correct ads and miles. So my car is a “Bad Deal” because the consumer advocates at Cargurus don’t know how to book a car out correctly? Or worse, intentionally misrepresenting pricing to a potential consumer, while labeling a dealer a crook at the same time.
I hope dealers in Texas see the big picture with Cargurus. They are not your friends, partners, allies, or well-wishers. Certainly don’t pay these scumbags to tell the world that you’ve had a car for 129 days, have lowered the price 4 times, and that you are the 2nd highest price in the market.
THEY DO THIS FOR FREE.
NOT JUST WHEN YOU PAY THEM TO “ADVERTISE”.
Carfax- Portrays dealers in the worst possible light, calls is liars, and tells customers to demand that THE DEALER buy their product to prove that we are telling the truth. And if we refuse- then go elsewhere. It’s extortion. These people actually try to act like they are on our side. Please.
When I read this article- it left me with a glimmer of hope that someone was finally putting a leash on these buffoons.
Now…To somehow blame dealers (who don’t pay Cargurus) for the idiotic practices of Cargurus is absolutely proposterous. They should shut down CarGurus just so this doesn’t confuse people. And Carfax, just because they are awful. I’d be happy to “Show you the Carfax” after you fork over the $40
(Or 4,000) they have forced a dealer to spend. No thanks.