On the Dash:
- Financing, advertising, and bait-and-switch complaints appeared twice as often at FTC-warned stores, according to a report by Widewail.
- 72% of FTC-warned dealers had at least one financing complaint, vs. 27% industrywide.
- FTC-warned dealerships averaged strong star ratings, masking elevated complaints on key compliance topics.
Dealership groups warned by the Federal Trade Commission (FTC) about deceptive pricing drew twice as many customer complaints about bait-and-switch tactics and advertising as the broader industry, according to a new Widewail study.
Widewail, a review analytics company, matched 63 of the 97 dealership groups and individuals on the FTC’s warning letter list against its database of 17,407 franchise dealers. The company analyzed topic-level reviews from the first quarter of 2026.
Looking beyond star ratings
At first glance, the FTC-warned dealers appear to be strong performers. They averaged 4.34 stars out of 5 on Google reviews during the first quarter, compared with an industry average of 4.49. FTC-warned individual dealers ranked in the top 41% of the market for overall reputation health score, and dealer groups ranked in the top 25%.
“Many are popular, high-volume, well-reviewed stores. A star rating alone would never flag them,” the report stated.
“The FTC group showed no meaningful difference from the comparison group when looking at public-facing review metrics: ratings, monthly review count, response rate,” Jake Hughes, Widewail Director of Marketing, said in a statement provided to CBT News.
What stands out
The differences became clearer when Widewail broke down complaints by topic. 17% of reviews for FTC recipients were negative, compared with 13% industrywide. Among reviews mentioning price, 26% were negative at the stores that received the letters. The industry average was 18%. 8% of comments about those dealerships’ honesty were negative, compared with 5.1% across the broader industry.
The gaps widened when Widewail looked into complaints about financing, advertising, and bait-and-switch pricing. FTC-warned dealers drew negative feedback on each of those three topics more than twice as often as the rest of the industry.
Advertising complaints showed the most pronounced difference. 4% of reviewers discussing advertising at FTC-warned stores complained about dealer practices. The industry average was 1.7%.
“Digging into what is said within the FTC-recipient reviews, our data shows the topics of the financing department, deals/advertising, and bait-and-switch are mentioned twice as often in negative reviews vs. the comparison group,” Hughes said.
The FTC letters
The Federal Trade Commission sent warning letters to 97 dealership groups in March, alerting them that their advertising practices may violate federal law.
The agency made the recipient list public May 28, naming some of the country’s largest retailers, including Lithia Motors, AutoNation, Group 1 Automotive, Sonic Automotive, and Hendrick Automotive Group. CBT News reported on the full list at the time.
The letters did not determine guilt. Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection, wrote that he was “concerned” recipients had engaged in one of six advertising practices the agency considers illegal.
Advertised vehicle prices must reflect the full out-the-door cost, excluding only government taxes and fees, Mufarrige wrote. Mandatory dealer fees, required add-ons, and financing contingencies must all be included in any advertised price.
Auto Leadership Summit on Fair Pricing and Compliance
CBT News will host the Auto Leadership Summit on Fair Pricing and Compliance on June 16 at the Salamander Hotel in Washington, D.C. The one-day event will bring together dealers, legal experts, and elected officials, including Ohio Sen. Bernie Moreno.
Widewail Chief Operating Officer Melissa Terrell will speak on the “Culture, Compliance, and Accountability: Building an FTC-Ready Dealership” panel, alongside Marco Schnabl, Founder and CEO of RockED.
Other topics include an in-depth analysis of the FTC ruling, best practices for transparent pricing and consumer disclosure, compliance frameworks for advertising and dealership operations, and a legislative outlook from NADA policy advocates.
Seating is limited and registration ends soon. Register now at cbtnews.com/auto-leadership-summit.
