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Comments Take Aim at FTC’s One-Sided Take on Dealership Customer Reviews



Jonathan Collegio

Jonathan Collegio

Former Senior Vice President, Public Affairs

New comments delivered to the Federal Trade Commission (FTC) critique the commission’s lack of even-handedness when it comes to consumer reviews of dealerships.

The FTC in July proposed a massive new set of regulations on the auto retail sector, which would create a host of new burdensome disclosures and forms throughout the sales process. To justify the proposal, the FTC referenced its complaints database, where consumers can complain about businesses like dealerships.

New comments by the Institute for Regulatory Analysis (IRAE) critique the FTC’s evidence as one-sided — as it leaves out the overwhelming number of positive consumer reviews about dealerships left on sites like Google and Yelp.

From IRAE’s comments:

“IRAE conducted independent analysis of more than 300,000 Google reviews of customer experiences at U.S. car dealerships. These reviews, in aggregate, reveal overwhelmingly positive results on the part of most reviewers. Additionally, the average (mean) rating of U.S. car dealerships has improved over the past 8 years…

“Our broad evaluation of 312,814 customer reviews from 2008 to 2022 found: 

  • “On a five-star scale, the mean rating was 4.47 across U.S. car dealerships…

  • “The mean star-rating has grown steadily from 2015 to 2022, from 4.25 to 4.54, respectively.”

The FTC has not released any quantitative studies on which it based its new regulatory proposal. NADA has repeatedly called on the FTC to slow the process down and use a more tested and data driven approach to its policies.

Comments to the FTC can be delivered until midnight on Monday, September 12, 2022.

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