2024 Car Ownership and Maintenance

The Federal Trade Commission and Maryland Attorney General have charged Lindsay Automotive Group with systematically deceiving and overcharging car-buying consumers for years, costing them millions of dollars in junk fees and unwanted add-on products.

The agencies’ complaint also alleges that Lindsay advertised prices it refused to honor and falsely claimed consumers needed to obtain financing through Lindsay. The agencies’ complaint alleges that three Lindsay dealerships and their management company, along with the company’s part-owner and president Michael Lindsay, COO John Smallwood, and the dealerships’ former general manager Paul Smyth, engaged in pervasive unlawful conduct.

“Auto dealers who trick consumers with bait-and-switch advertising, financing sleights of hand, and unwanted add-ons should expect to hear from the FTC,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “The FTC and its state partners will continue working to combat this illegal conduct.”

“Buying a car is a significant financial investment. Marylanders deserve to know upfront how much they will actually pay for a vehicle and should not be surprised by hidden charges that they did not budget for,” said Attorney General Anthony G. Brown. “Our Office will not let car dealerships profit from unfair and deceptive practices.”

Deceptive pricing

According to the complaint, Lindsay regularly advertises deceptive prices on its website and in its advertising, promoting vehicles for sale at a price that is not actually available to the vast majority of consumers. Lindsay employees continue the deception when consumers call, claiming the advertised price is real.

Only when consumers get to the dealership do they learn that the price is hundreds or even thousands more than advertised because they do not qualify for a raft of rebate programs, or because they must pay thousands of dollars in additional fees. One dealership manager cited in the complaint told a consumer that the price on the website “was not realistic” and that “no one would qualify for it because it was nearly impossible to qualify for all the rebates to get to that price.” In fact, Michael Lindsay told Smallwood and others, “we never deliver the vehicle anywhere near the stated price.”

The complaint cites numerous examples in which customers, who sometimes traveled significant time and distance, including booking flights from other states, to get to Lindsay dealerships based on the low advertised prices, were hit with supposedly mandatory fees of thousands of dollars. In other cases, dealership employees simply told consumers directly that the advertised price wasn’t true, according to the complaint.

A sample of Lindsay’s transactions shows that 88 percent of consumers who bought a car from the defendants’ dealerships from 2020 to 2023 paid more than the advertised price—on average over $2,000 more—according to the complaint.

Additionally, the complaint charges that Lindsay’s unlawful conduct didn’t stop at the vehicle’s purchase price. Instead, after consumers navigate the often arduous process of negotiating a price, they then face further challenges when Lindsay deceptively claims that they must finance their car through the dealership.

"Kickbacks"

Lindsay receives what it calls “kickbacks” from financing companies when consumers finance a car through the dealership, according to the complaint. Consumers who arrive at Lindsay dealerships looking to pay cash or with pre-approved financing from another financial institution are regularly told that the advertised price won’t be honored.

The complaint cites multiple instances in which consumers were directed to financing offers through Lindsay that charged higher interest than what they’d obtained on their own—and would cost them thousands more over the life of the loan. A survey cited in the complaint showed that more than a third of Lindsay shoppers were told that financing through the dealer was mandatory to purchase the car or to obtain the advertised price.

Finally, the complaint alleges that Lindsay systematically charged consumers for add-on products—such as extra service plans, tire and rim protection, and “guaranteed asset protection” coverage—they did not consent to purchase or falsely told consumers the add-ons are mandatory. In fact, a survey cited in the complaint shows 68% of consumers were charged for at least one add-on they did not agree to buy or were falsely told was required. These charges often amount to hundreds or thousands of dollars for each consumer.

The complaint charges that Lindsay Chevrolet of Woodbridge; Lindsay Ford of Wheaton; Lindsay Chrysler-Dodge-Jeep-Ram; Lindsay Management Company, LLC; and individual defendants Lindsay, Smallwood, and Smyth violated the FTC Act as well as Maryland’s Consumer Protection Act. The complaint asks the court to stop Lindsay’s unlawful actions and provide redress to the consumers harmed by those actions.

Starting January 1, 2025, California's "lemon law," which protects buyers of defective vehicles, will undergo changes that could confuse car buyers, especially those with faulty new or used cars.

The law has long allowed consumers to get a replacement or refund for a defective car. However, a new law signed by Governor Gavin Newsom this year will make it harder for consumers to take legal action, with shorter time frames and fewer rebates for defective cars.

Newsom signed the new law but said he expected the legislature to pass a new version quickly. 

The confusion stems from a law that could allow car companies to opt out of these changes, depending on further legislation. The law was passed to address a backlog of lemon law cases in California courts, but critics argue it weakens protections for consumers and mainly benefits U.S. automakers, who face more lawsuits than foreign car companies.

A recent California Supreme Court ruling also complicated the situation by stating that warranties on new cars do not apply once the car is resold as used. This leaves consumers who bought a used car with ongoing problems, without the same legal protections.

Lawmakers are working on new legislation to address these issues, but for now, car buyers will have fewer rights and protections regarding defective cars.

Many lawmakers say they were blindsided by the measure.

“There wasn’t a single person who represents the people of California who knew about this and was a part of those conversations – for months,” Democratic San Ramon Assemblymember Rebecca Bauer-Kahan told her colleagues on the Assembly Judiciary Committee on Aug. 30. “They dropped this in our lap, and they expect us to buy an argument related to the urgency that feels, to be honest, not real. And we’re supposed to move this in a week’s time.”

A group of 10 Illinois car dealerships are facing a $20 million fine, the largest ever levied against a car dealer by the Federal Trade Commission. The money will be used to make refunds to customers.

The dealer group, doing business as Leader Automotive Group and their parent company, AutoCanada, operate the following dealerships:

• North City Honda;
• Crystal Lake Chrysler Dodge Jeep Ram;
• Hyundai of Lincolnwood;
• Kia of Lincolnwood;
• Bloomington Normal Auto Mall (Mercedes-Benz of Bloomington, Lincoln of Normal, Volkswagen of Bloomington Normal, Volvo Cars Normal, Subaru of Bloomington Normal, and Audi Bloomington Normal);
• Autohaus Motors (Mercedes-Benz of Peoria, Porsche Peoria, Volkswagen of Peoria, and Audi Peoria);
• Chevrolet of Palatine;
• Hyundai of Palatine;
• Toyota of Lincoln Park; and
• Toyota of Lincolnwood.

The fine follows a lawsuit by the FTC and state of Illinois.

In addition to paying $20 million, which will be used to refund harmed consumers, the proposed settlement also would require the companies to make clear disclosures of a car’s offering price—the actual price any consumer can pay to get the car, excluding only required government charges—and get consent from buyers for any charges. 

“Working closely with the Illinois Attorney General, we are holding these dealerships accountable for unlawfully extracting millions of dollars from consumers through a textbook bait-and-switch scheme, and bolstering their poor reputation with fake reviews,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. 

“This dealership network engaged in bait-and-switch tactics by luring consumers into their dealerships with lower prices only to either require consumers to purchase allegedly pre-installed add-on products or charge consumers for those products without their knowledge or permission,” said Illinois Attorney General Kwame Raoul. 

Junk fees, fake reviews, Canadian cars

The agencies' complaint alleges the defendants have deceived consumers about the price and availability of vehicles, charged them for expensive add-ons without consent, tacked on unwanted junk fees to purchases, posted fake reviews, and failed to disclose that U.S. customers were buying cars imported from Canada, along with other unlawful conduct.

Leader has frequently advertised new and used cars online with low prices designed to entice consumers into their dealerships, but those prices are often false, according to the complaint.

When consumers arrive at a Leader dealership, salespeople often tell them the car has preinstalled add-ons like protective coatings (often under the name Xzilon) and theft protection (under the name LoJack) that cost thousands of dollars, and that these add-ons are required despite not being included in the advertised price of the car.

According to the complaint, the add-ons have been wildly profitable for Leader, with dealerships at one point reporting more than 99% profit on them. Leader salespeople have been paid a commission for these add-on products, in many cases making more from the sale of the add-ons than the commission they are paid for selling the car itself.

A survey of Leader customers showed that nearly 80% of them were charged for at least one add-on without authorization or because they were falsely told the add-on was required. The unwanted add-ons also included items tacked on in the financing process like guaranteed asset protection (GAP) coverage and service contracts.

Add-on charges 

The complaint charges that, even after learning that the FTC was investigating, Leader kept tacking on add-on charges, resulting in consumers paying thousands more than the advertised price. Leader allegedly required the Xzilon add-on for all new and used cars they sold starting in 2021.

According to the complaint, Leader has also regularly failed to actually install or apply the add-on products for which they charged consumers without their consent.

Leader’s low-price advertising was designed to “get [customers] through the door,” according to a message from a company executive cited in the complaint. In many cases, however, Leader has advertised cars that have already been sold.

When consumers arrived at the dealership, they were directed to more expensive cars, often ones with junk fees and surprise “market adjustments” added to the price. The complaint cites another message Douvas sent to employees saying that once consumers get to the store, “they’re not leaving” without buying a car.

Leader has also regularly advertised cars as being “certified pre-owned,” and available at a specific price but then charged consumers hundreds or even thousands of dollars in additional “certification fees.”

In many cases, despite advertising the cars as being certified and charging consumers undisclosed fees for that certification, Leader has failed to actually do the certification work required by the manufacturer of the car, leaving consumers without the extended warranty that makes certified pre-owned cars attractive in the first place.

Even on non-certified used cars, Leader has charged exorbitant “reconditioning” fees, which one former sales manager described as “fake fees,” according to the complaint.

Canadian cars, bogus reviews

Leader also has sold cars in its U.S. dealerships that were manufactured for the Canadian market without disclosing that to consumers, according to the complaint. Even when done legally, importing these cars into the U.S. typically voids their manufacturer’s original warranty. Leader still deceptively advertised many of these cars as being covered by those warranties.

In addition, the complaint alleges that employees were required by management to post fake positive reviews about their dealerships on Google and other review sites.

Managers have threatened to withhold bonuses and other compensation from employees who don’t post fake reviews, and have paid employees bonuses for posting fake reviews, according to the complaint.

One email from a manager encouraging more reviews said: “Those of you with a low review score and low volume of reviews its [sic] an easy fix. If you have 10 employees and they have 5 family members or friends you can have 50 reviews right away.”

The complaint also alleges that dealerships have bullied and pressured consumers into posting five-star reviews, citing one instance in which a dealership refused to give a consumer the keys to a car she purchased until she posted a positive review.

Auto lenders that offer a strong digital experience through their websites and mobile apps have much higher customer satisfaction levels and greater self-service usage. But according to the J.D. Power 2024 U.S. Automotive Finance Digital Experience Study

 40% of automotive finance digital experiences fail to meet basic standards for modern design, ease of use, and problem-free operation.

The study highlights that only 2% of auto finance websites and apps deliver a truly comprehensive digital experience, meaning they allow customers to verify payoff amounts, view account balances, and select payment amounts.

“Lenders have a huge opportunity to build customer loyalty and advocacy by fostering streamlined, two-way communication, but far too many are treating their digital properties as a transactional portal that only exists for bill pay,” said Patrick Roosenberg, senior director of automotive finance intelligence at J.D. Power.

“These digital properties should be seen as two-way portals to communicate with customers on a month-to-month basis, while improving customer satisfaction and reducing cost to serve,” he said.

Lags behind others

Additionally, the auto finance industry lags behind other sectors like wealth management, retirement plans, and insurance in terms of digital experience.

The study also found that non-captive auto finance apps (those not tied to a specific brand, like Chase Auto) tend to outperform captive apps (like GM Financial), likely because non-captive apps use more advanced mobile banking frameworks.

GM Financial ranked highest among captive lenders in digital experience satisfaction, while Chase Auto led among non-captive lenders. The study is based on responses from over 6,000 automotive finance customers.

For more information about the U.S. Automotive Finance Digital Experience Study, visit https://www.jdpower.com/business/us-automotive-finance-digital-experience-study.

Connectivity problems are a big issue for car manufacturer apps used with internal combustion engine (ICE) vehicles, according to the J.D. Power 2024 U.S. OEM ICE App Report.

About 32% of owners reported app connectivity issues, up from 29% in 2023, and 61% said the app connects to their vehicle too slowly.

Quick response times are critical, with 73% of users expecting the app to respond within 10 seconds. Despite these challenges, 77% of owners still use their brand’s app at least occasionally, showing its importance in the car ownership experience.

“That’s why it’s beneficial for manufacturers to continue addressing performance gaps and ensuring competitiveness in the market,” said Violet Allmandinger, mobile apps lead at J.D. Power. “Automakers have made improvements in app features, improved response times and fixed connectivity gaps but, to improve customer satisfaction, they need to deliver core features that perform reliably.”

Key findings from the report include:

• High demand for security features: 83% of users want features like vehicle camera viewing and security alerts.
• Low interest in in-app marketplaces: 72% of users don’t want marketplace features included in apps.
• Vehicle status updates lag: While 92% of owners want timely updates on their car’s locks, windows, and doors, many apps don’t provide this reliably.
• Reasons for disengagement: Owners who stop using the apps cite lack of features (25%) and not needing the app (45%). Lower costs and better functionality could bring them back.
• Room for improvement: Users rated app navigation and speed as very important but were less satisfied with these aspects.

Top-rated apps include MyHyundai with Bluelink for mass market brands and Genesis Intelligent Assistant for premium brands.

The report, based on surveys of over 1,900 ICE vehicle owners, highlights the need for automakers to address app performance gaps and deliver reliable features that meet users’ needs. For more details, visit the J.D. Power website.

If you are in the market for a used car that you want to last for years, wouldn’t it be helpful to know what used cars your fellow consumers have owned for at least 15 years, liking them enough not to trade them in?

When an original owner keeps a vehicle for more than 15 years, it’s safe to assume they’re pretty happy with their ride. In a new study, automotive website iSeeCars identified the 13 cars that original owners keep for at least 15 years more than all other cars. 

The average time for a consumer to hold onto a new car is eight years. Keeping it for 15 years suggests there’s not an issue prompting the owner to want something new. Among the top 13 models, Toyota accounts for seven – three of which are hybrids.

“Most consumers can’t commit to a single vehicle for more than a decade, but those that do save a lot of money on their vehicle costs,” said iSeeCars Executive Analyst Karl Brauer. 

“Keeping a car for 15 years means no loan payment for most of that time, along with falling insurance and registration costs. Those reduced expenses can counter higher maintenance costs as a car ages, especially in durable models that hold up well over time.”

The average percent of 15 year old cars kept by their owner was 3.7% among the vechicles.

Toyota models hold down the top five slots with 7% of Toyota Highlander Hybrids still with the original owners at least 15 years after being driven off the lot. 

“The functional, high-value nature of these models aligns with long-term ownership,” said Brauer. “If you’re keeping a car for 15 or more years you want reliability, practicality, and fuel efficiency, traits all of these cars offer.”