TrueCar and automotive dealerships just can't seem to stay out of the spotlight. An investigation is underway by the Federal Trade Commission into a number of dealers that stand accused of "agreeing to refuse to deal with TrueCar," according to an FTC letter obtained by Automotive News. The alleged collusion, which would violate federal competition laws, has triggered a non-public investigation that has had many dealerships, and TrueCar itself, served with letters demanding documents.

It's believed that the investigation stems from a pair of incidents in 2011 and 2012 that led a number of dealerships to abandon the price-quoting and research website, although TrueCar claims it had nothing to do with initiating the investigation. Regarding the odd timing, almost two years after the last issue took place, TrueCar CEO, Scott Painter, told AN, "It's like calling in reinforcements for a battle that's already over."

In 2011, a number of dealers stopped doing business with TrueCar due to a system that required salespeople from dealers to bid against each other to win shoppers, with many losing money on the no-haggle transaction price. Regulators got involved in 2012, when TrueCar was accused of violating consumer protection laws in some states over its sale of leads, a practice known as "bird-dogging." In both cases, TrueCar changed it's position, canceling the 2011 policy and switching to a subscription-based payment system in states where consumer protection was an issue.

We'll continue to follow the investigation, and bring you any news that pops up.


I'm reporting this comment as:

Reported comments and users are reviewed by Autoblog staff 24 hours a day, seven days a week to determine whether they violate Community Guideline. Accounts are penalized for Community Guidelines violations and serious or repeated violations can lead to account termination.


    • 1 Second Ago
  • 20 Comments
      • 1 Year Ago
      [blocked]
      Ducman69
      • 1 Year Ago
      I don't understand, I look at Truecar and their prices suck. Were they great at one point in time? Just print out Edmunds TMV with all the options you want, bring it to the dealer, say you want that as an out-the-door price after any fees they decide to add on here and there, and if they say no then walk away. Its worked for me.
        icemilkcoffee
        • 1 Year Ago
        @Ducman69
        Truecar shows you the distribution of how much people in your area paid for a particular car.
          gary
          • 1 Year Ago
          @icemilkcoffee
          It only shows you an distribution of people who bought a car from a TrueCar affiliated dealer paid... and that distribution may be "estimated" if there's not enough statistical data (which there very well may not be, especially on a lower volume model). Also keep in mind that TrueCar gets a $300 fee from the dealer on every new car sale in most states. If you find a dealer willing to take the same profit margin who is not affiliated with TruCar you can save yourself at least $300.
      b.rn
      • 1 Year Ago
      Having recently purchased a car, I took a look into truecar. I saw no reason to utilize them. They'd quote you a price for a car that doesn't exist. That price was quite a bit higher then you could get by going to your favorite car sales website (cars.com, carsoup.com, autotrader.com, etc). It came off as nothing more than a way to get contact information for dealers to use and abuse.
      pvalerio
      • 1 Year Ago
      As a car salesman, I like the idea of a haggle free scenario in which customers are willing to pay a fair price between MSRP and invoice, but for the FTC to scold a dealer who doesn't wish to budge is crossing the line. In a world where people blindly pay $199 every year for the latest smart phone, or blow $1,000 on Candy Crush lives, I think it's amazing that people get so butt hurt over a dealer looking to make a little bit of profit. TrueCar's old business model of showing people cost on a car was way out of line, but their new approach of showing a fair discount is much easier to swallow. Even still, the FTC has no business telling a dealer their not allowed to turn away a customer who has a TrueCar price . . . at the end of the day, it is their business and they can run it how they want. Perhaps we should set up a website called TruePolitics in which we can see how much money the lobbyists are paying the guys at the FTC to rig the system in their favor. I have to agree with Gator though, Tesla has a movement right now that you can't ignore.
        The Wasp
        • 1 Year Ago
        @pvalerio
        That's not what this investigation is about. Re-read the article. It's about collusion between dealerships that supposedly compete with each other but instead worked together to take advantage of potential customers.
      balllboy
      • 1 Year Ago
      Ducman69, Maybe the dealers around you are part of the problem identified in the article. I was looking at (and just bought a new vehicle. Truecar was $3-4K less than Edmunds TMV. I ended up using truecar pricing as a starting point.
        Ducman69
        • 1 Year Ago
        @balllboy
        Oh ok, I was just looking up a test car and the truecar participating dealer guaranteed price was much higher than Edmunds TMV. I thought Edmunds and Truecar use the same database of dealer sales. *shrugs* Either way, it is good to stay informed. Personally, I wish we could eliminate dealerships as an obsolete business model entirely. Every major city instead can just have a single manufacturer warranty service, showroom, and test facility with its own little test track in the back. No worries about traffic and the like, and you can have a little hill segment, a bumpy road segment, a quick S turn, and emergency stop and what not and because it'll be on a single test model there's no concern about ragging it. When you are happy with the vehicle, you simply order it there or online at a fixed price and they deliver it there for pickup or to your home. Like an Amazon type warehouse distribution of goods.
      reattadudes
      • 1 Year Ago
      now let me get this straight. TrueCar has danced around and changed its positions repeatedly, and the DEALERS are being investigated???
      Gator
      • 1 Year Ago
      Dealers are a thing of the past. They never properly represent the manufacturer due the lack of support. They should want to build relationships, not just money. I hope the Tesla idea spreads like wild fire to get rid of these shady places. I can't believe they get away with what they do. Tho, the shopper is fully responsible in the end for agreeing.
      Drakkon
      • 1 Year Ago
      Isn't bird-dogging what they call it when you hit on a friend's girlfriend, or some other girl who is totally unsuspecting that you may even think of approaching her at the time?
      Rishbh Rana
      • 1 Year Ago
      the answer i got was the true car price that i got in total with without the subtractions was not avialable in stock, so they charged me a grand over the price i had on true car... i bought a 2013 nissan altima so far so good.
      Red
      • 1 Year Ago
      True car is NOT transparent. Their prices are ridiculously inflated. Anyone can get money off the sticker price without using True car. The dealers pay a huge monthly fee and a lead generation fee every time someone uses True Car. Once a dealer is signed up with them, they can't afford to deal with consumers and give them any less off due to the thousands they pay True Car, which is a ripoff for the dealers and the consumers. Problem is so many consumers are too lazy to do their research. No one needs to use True Car. I look at them and laughed when I was looking to buy a car. The True car dealer was much higher priced than a non true car dealer for the same vehicle. Why dealers have been sucked into using this tactic is beyond me. True Car has bullied dealers and it even has been offered they stole data from competitors to get pricing and info. As to the recent bad press true car has been getting the timing appears to be that they need to get their name back in the light and look better than they are, that is why I personally believe this is coming to light. Another trick by True car to try and force dealers to pay their exorbitant fees. Last I checked competition and negotiation sold the two larges investments people make, i.e. house and car and that it is legal to advertise where you want, and negotiate where and with who you want and no law you have to be a part of True Car. Get over yourself True Car.
      Auto buyers ADVOCATE
      • 11 Months Ago
      TrueCar / Scott Painter Does not need access to the car buyers personal and private information including their Social Security number it's none of their business. Consumers need to be told by the dealership that this is going on if what I have been told is true. Something very big is coming to the auto industry and many consumers are going to love it it's going to be LIVE !!!!
      Auto buyers ADVOCATE
      • 11 Months Ago
      Stanley you are in the auto industry why don't you tell us what you know about what kind of information TrueCar has access to regarding the car buyers personal and private data ? Too many dealerships are afraid of telling the public what's really happening to their data their personal and private information. They are afraid of car buyers walking away from their dealerships if the customer is told what's really going on.
    • Load More Comments