Upcoming Advertising Standard on Retired Courtesy Vehicles

MADA is finalizing a new Advertising Standard to clarify how dealerships advertise retired courtesy vehicles. This update follows a change to Minnesota law allowing dealers to place dealer plates on courtesy vehicles, meaning these vehicles no longer need to be titled in the dealership’s name. This change raised an important question: can dealers sell or register courtesy vehicles as new vehicles?

• Driver and Vehicle Services (DVS) concluded that dealers may title courtesy vehicles as new.
• The Minnesota Attorney General’s Office (AG’s Office) concluded that dealers may not advertise or sell courtesy vehicles as new.

Given the AG’s conclusion, the MADA Board of Directors and the Ad Standards Steering Committee have approved a new Ad Standard that prohibits advertising courtesy vehicles as new vehicles:

Advertising Standard No. 20

Retired Courtesy Vehicles. For purposes of these Advertising Standards, “retired courtesy vehicles” include service loaners, courtesy transportation vehicles, and any other vehicles previously made available for temporary consumer use before retail sale that were driven more than the limited use necessary in moving or road testing the vehicle prior to delivery to a consumer.

Dealers must not advertise, describe, or represent any retired courtesy vehicle for sale or lease as a “new” vehicle. Dealers must clearly distinguish any retired courtesy vehicle for sale or lease from new vehicles and disclose and accurately describe its prior use.

On a dealer’s inventory webpage, dealers must not list retired courtesy vehicles as “new.” A dealer must list a retired courtesy vehicle for sale or lease as “used.” Alternatively, dealers may create and use a separate, clearly identified inventory category—such as “Retired Courtesy Vehicles,” “Loaners,” “Courtesy Transportation Program,” or “Service Loaners”—that differentiates these vehicles from new inventory.

This standard also applies to listings that a dealer places on any third-party website, including but not limited to Cars.com and similar platforms. If a third-party website only allows vehicles to be labeled as new or used, the dealer must list retired courtesy vehicles as “used.”

To the extent that a manufacturer exercises exclusive control over a dealer’s inventory feed for retired courtesy vehicles and automatically places them in the new-vehicle section of the dealer’s inventory webpage, the vehicle’s appearance in the new-vehicle section does not violate this Ad Standard. In those situations, the dealer must take all steps within its control to ensure that an individual vehicle listing that is designated as new by a manufacturer clearly and conspicuously denotes that the vehicle is a retired courtesy vehicle, including by keeping all applicable labels, flags, and descriptive fields regarding its prior use active and accurate.

Enforcement: Lathrop GPM, the law firm tasked with enforcing the Ad Standards, will begin enforcing this new Ad Standard on March 1, 2025.

Click here to access the Ad Standard Program materials.