A consumer advocacy group wants the Consumer Financial Protection Bureau and other agencies to regulate pricing of F&I products, such as extended service contracts, based in part on data that allegedly show dealerships have charged Hispanic customers higher prices.
"Obviously, we'd love to see the CFPB, the FTC, state attorney generals, address this through enforcement in the short term and for federal and state legislators to address it in the longer term through legislation," John Van Alst, a staff attorney for the National Consumer Law Center advocacy group in Boston, told Automotive News.
The law center also thinks that for every vehicle on their lots, dealerships should be required to post a list of available F&I products and prices alongside the price of the vehicle.
The National Automobile Dealers Association and Motor Vehicle Protection Products Association, a trade association based in Tallahassee, Fla., reject the law center's conclusions.
If prices on F&I products were fixed, NADA says, dealerships no longer could offer discounts, which would make the products more expensive and less available. F&I products add value, NADA says.
"Voluntary protection products are incredibly valuable for millions of consumers," NADA spokesman Jared Allen told Automotive News on Monday. "Just ask consumers who were made whole by GAP insurance on the total loss of their vehicles due to Hurricanes Harvey and Irma."