The practice of new car dealers selling vehicles over MSRP has been a topic of concern in the automotive industry, especially in high-demand/low-inventory situations. This article will explore the rules in California addressing this issue, and the potential legal implications for dealers.

California and how consumer lawyers are using this argument against you.

The practice of new car dealers selling vehicles over MSRP has been a topic of concern in the automotive industry, especially in high-demand/low-inventory situations. This article will explore the rules in California addressing this issue, and the potential legal implications for dealers.

California's Rules on Selling Cars Over MSRP and California Vehicle Code 11713.1(b)

According to the California Vehicle Code, dealerships are generally allowed to sell vehicles at any price they choose. However, dealerships must comply with California's advertising and disclosure laws, which require them to disclose the total selling price of the vehicle, except for statutorily identified fees, taxes, and charges.

It is also known that some dealers advertise vehicles with "Call for price" which could be problematic if different prices are quoted to different customers either in person or through phone calls/emails/text messages, potentially leading to discrimination claims.

Additionally, the California Vehicle Code prohibits dealerships from engaging in "unfair and deceptive acts or practices" in the sale of vehicles. This includes misrepresenting the price of a vehicle or its features, or using bait-and-switch tactics to lure customers into the dealership. Please read the California Vehicle Code 11713.1(b):

"Except as otherwise provided in this code, a dealer shall not engage in any unfair or deceptive act or practice, as defined in Section 17200 of the Business and Professions Code, in the advertising or sale of vehicles. Any violation of this subdivision shall constitute good cause for revocation of a dealer’s license."

While there are no specific laws in the California Vehicle Code that prohibit dealerships from selling vehicles above MSRP, they must comply with advertising and disclosure laws and cannot engage in unfair or deceptive practices.

Legal Ramifications for Dealers

Plaintiffs' lawyers, including the Margarian Law Firm, have filed lawsuits against new car dealers over the issue of dealers advertising and selling cars over MSRP in California.

The issue of new car dealers selling cars over MSRP is a complicated one with legal ramifications for dealers. California's rules on advertising the total price of a vehicle provide guidance to dealers, but it is crucial to ensure consistency in pricing and avoid discriminatory practices. Talk to an experienced attorney regarding this issue.