California Law Targets Car Sales Scams, Enhances Buyer Protections

California is implementing new regulations aimed at curbing deceptive practices in the automotive retail sector with the enactment of the California Combating Auto Retail Scams (CARS) Act. This legislation, which takes effect on October 1, requires car dealerships across the state to advertise the total price of vehicles and clearly indicate which add-ons and features are optional for buyers and lessees.

The bill, Senate Bill 766, was authored by Senator Bill Allen of Santa Monica and signed into law by Governor Gavin Newsom in October of the previous year. Its passage is intended to bring greater transparency and fairness to the car buying and leasing experience.

According to Senator Allen, the CARS Act will "codify best-in-class protections for California car buyers" and "make a real difference for consumers by making the car buying experience more fair and transparent." This sentiment was echoed by Ted Mermin, director of the California Low-Income Consumer Coalition, who stated in an October press release that the bill is a "significant step forward for California consumers and for an industry that has been allowed to get away with outrageous sales tactics for far too long."

A key provision of the CARS Act is a "right to cancel" policy, a first of its kind in the nation. This policy grants buyers and lessees a three-day window to return a vehicle, provided its value is less than $50,000. Mermin noted that under the new law, consumers seeking a car's price will receive a direct answer, contrasting it with the potentially lengthy process previously involved.

The new regulations apply to both new and used vehicles weighing under 100,000 pounds. The legislation aims to protect consumers from hidden costs, misleading contract terms, and predatory sales tactics that have historically plagued the industry.