Donohoo Transparency Promise – No Dealer Fees

The FTC released a press release regarding the protection of consumers against unscrupulous dealers, and while the FTC’s communication on this topic is a bit messy and lacks some understanding of the market for vehicles, the overall theme is on target for improving consumer shopping experiences. At Donohoo Auto and Donohoo Chevrolet, we pride ourselves on a customer-first sales approach. Therefore, our transparent policies align with where the FTC is trying to go with these policy updates. 

The Donohoo Transparency Promise

When you want to buy a new car, don’t pay extra by going to a dealership that charges added dealer fees. Donohoo Chevrolet eliminates unnecessary add-ons, saving you hundreds or even thousands of dollars on your new Chevrolet.

At Donohoo, our sales team works for you, and rather than trying to sell you on a vehicle, our goal is to match you with what you are looking for. We deliver on upfront pricing and free history reports. We will always work to save you money.

FTC Goal and Our Thoughts On Them

The Federal Trade Commission has proposed a ban on junk fees and bait-and-switch advertising tactics that can plague consumers throughout the car-buying experience. As auto prices surge, the Commission seeks to eliminate the tricks and traps that make it hard or impossible to comparison shop or leave consumers with thousands of dollars in unwanted junk charges. The proposed rule would protect consumers and honest dealers by making the car-buying process more transparent and competitive. It would also allow the Commission to recover money when consumers are misled or charged without consent. 

In the last ten years alone, the FTC has brought more than 50 law enforcement actions related to automobiles and helped lead two nationwide law enforcement sweeps that included 181 state-level enforcement actions in these areas. Yet, despite these actions, complaints from consumers related to automobiles remain in the top ten complaints received by the FTC, with more than 100,000 complaints from consumers annually over the past three years.

Today, the FTC is taking a first step toward establishing guidelines that would provide consumers with key protections against dealers who unlawfully charge junk fees without their consent or engage in bait-and-switch advertising. 

Ban bait-and-switch claims: 

The proposal would prohibit dealers from making several 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.

While it might cause problems when customers “expect” to haggle, our prices are set long before you step through our doors. We have a fixed sales price for our used vehicles, and our new vehicle prices reflect the incentives most customers qualify for. We have held this policy long before it was common, and our advertised price is our best price. 

Chevrolet has done a good job preventing rebates from showing in the pricing math box on a Chevrolet website unless it is available to everyone. Those rebates are shown below the final price as a rebate someone may qualify to receive. Any advertised price from us will conspicuously state if it includes a rebate only available with conquest (owning a non-GM make), loyalty (owning a GM make), trade requirements, GM Financial financing used, or any other requirements. As a warning, some dealers will not honor the price on their websites if the customer does not finance through the dealer. Some will make the price contingent on trading. Our price is the price regardless of whether you finance through us, trade with us, or pay with cash.

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).

We only add on a product with your explicit understanding of what you are purchasing. Our typical add-ons are service contracts, GAP, and protection plans that we wholeheartedly endorse with real tangible value to the customer. If you sign up for any of these, we ensure you understand the costs and the benefits you are receiving, and we provide you the option to choose which of these products you would like to purchase with no requirement to purchase any of them.

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 car’s price without any optional add-ons.

We utilize menus to walk through the additional options that could be charged outside the price of the vehicle and let you decide which add-ons you would like to add. You sign up for these add-ons with your written consent before we add them to the amount you pay for your vehicle. We have vetted the add-ons to sell you and make sure these provide real value and are available from well-run companies that will stand behind them.

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 the 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.

We do not require you to trade or finance with us unless GM has specific incentives that state otherwise. Our used vehicle prices are entirely transparent. We used to disclose our documentation fee on the vehicle’s page, but we recently decided to remove it completely. Many dealers charge you a document fee which could run close to a thousand dollars. This fee is meant to cover additional costs for selling the vehicle. This fee has a maximum amount in many states.

In Alabama and most adjacent states, there is no maximum, and some dealers charge hundreds of dollars. Ours was a modest $199 and hardly covered our additional processing costs, but in August 2022, we changed our policy to eliminate the doc fee completely to make our pricing simpler for our customers.

We have seen dealers charge a document fee (also known as an administrative fee), AND charge additional fees on top of that. We have seen dealers charge a destination fee to the customer for a new vehicle that is already included in the MSRP in the vehicle, effectively double charging the customer. Other than taxes and other government-mandated fees, we feel the vehicle’s price should reflect everything and be the price you pay the dealer.

We realize our $0 in dealer fees will put us at a competitive disadvantage to other dealers advertising lower prices and then hitting the customer with a $900 fee at closing, but we are going to be on the side of transparency, and trust customers will reward transparent dealers with their business or be savvy enough to investigate dealer fees when comparing prices.

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