Regulations Archives - Center for Automotive Research

Assessment of Costs Associated with the Implementation of the Federal Trade Commission Notice of Proposed Rulemaking (RIN 2022-14214), CFR Part 463

Mark Garrison — Sun, 04 Jun 2023 19:54:54 +0000

The Federal Trade Commission (FTC) published a proposed Motor Vehicle Dealers Trade Regulation Rule (16 C.F.R. § 463) (“Trade Rule”) on July 13, 2022. In the Trade Rule, the FTC solicited “comments from the public to improve [benefit or cost] estimates before the promulgation of any final Rule.” In response to this solicitation, the National Automobile Dealers Association (NADA) requested the Center for Automotive Research (CAR) to conduct this study to help determine and analyze the potential impact of the Trade Rule, if finalized as proposed, on franchised light-duty vehicle dealerships, their likely actions in response, and the costs associated with compliance.

Estimated costs for dealer compliance and the impact on their transactions with consumers were derived from approximately 60 dealer surveys and 15 interviews, conducted from August 2022 through December 2022, with dealers, ESIGN contract technology providers, and IT developers,3 as well as regulatory training professionals. CAR’s survey focused on five key areas including: 1) prohibited misrepresentations, 2) new consumer disclosure requirements, 3) “Add-On” prohibitions and disclosures, 4) recordkeeping, and 5) consumer vehicle transactions. Importantly, dealers were asked for incremental costs, directly related to regulatory compliance only.

The Center for Automotive Research also included qualitative feedback from dealers within our study to support key survey findings, provide essential dealer feedback, and capture respondents’ viewpoints on key regulatory challenges for consideration. Additionally, CAR researchers elected to present our dealer survey findings using median values, to reduce the influence of outlier responses, and to provide the most conservative estimate of costs.

According to the analysis in this study, median upfront costs for compliance with the Federal Trade Commission Rule, if finalized as proposed, were estimated by dealers to be USD 46,950 per location. These upfront costs include updated training, IT system investment, as well as planning and preparation. This results in a total median upfront cost of USD 2,184,348,750 for automobile dealers nationally.

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NAFTA Briefing: Review of current NAFTA proposals and potential impacts on the North American automotive industry

swhitehouse@cargroup.org — Thu, 26 Apr 2018 16:59:36 +0000

The U.S. automotive industry is heavily dependent on trade within the North American Free Trade Agreement (NAFTA) region. Current proposals to change how NAFTA works in the automotive and parts industries have the potential to alter these U.S. industries dramatically. The renegotiation of NAFTA is ongoing, and proposals are changing every day. This briefing examines many of the current issues on the table and the potential impact of those proposals on the U.S. and North American automotive and parts industries.

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The Great Divide: What Automotive Consumers are Buying vs. Auto & Supplier Investments in Future Technologies, Products & Business Models

swhitehouse@cargroup.org — Thu, 22 Feb 2018 15:09:21 +0000

The U.S. automotive industry is in the midst of a critical period. U.S. light vehicle sales are plateauing at a very high level and include a rich mix of pickup trucks, SUVs, and CUVs that are producing record profits. Despite all the new truck, SUV, and CUV launches at last month’s NAIAS, the companies’ presentations focused on the future of connected and autonomous vehicle (CAV) technologies, new mobility service models, and advanced powertrain solutions. Automakers are making big bets and hope they will pay off. Ford Chairman Bill Ford summed up the divide when he announced his company’s $11 billion investment in EVs in January 2018, “…we’re all in now. The only question is will the customers be there with us, and we think they will.”

This research addresses the U.S. segment mix, the impact of CAV on personal vehicle ownership, the tension between consumer demand and regulatory mandates on EVs, and the implication for the nation’s engineering and skilled talent development institutions and the overall technological leadership of the United States.

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