Minnesota dealers should note a recent Federal Trade Commission (FTC) warning letter campaign that targets how vehicle prices are advertised. While the letters do not create new law, they clearly signal enforcement priorities and raise important questions about how federal expectations may interact with existing Minnesota law.

The FTC emphasizes a simple principle: the price consumers see in advertising should be the actual price they pay—except for “required government charges, like taxes.”

The FTC lists examples of illegal pricing practices, including:

• Advertising a price that does not reflect all required fees

• Advertising prices that depend on unavailable rebates or discounts

• Conditioning prices on financing through the dealership

• Requiring add-ons not disclosed in the advertised price

For dealers, the key takeaway is that the FTC expects advertised prices to include “all required fees and charges aside from required government charges.” This reflects the agency’s broader crackdown on so-called “junk fees” across multiple industries.

Minnesota has a price transparency (or “junk fee”) law that generally requires the advertised price of a product or service to include required fees. However, Minn. Stat. § 325D.44, subd. 1b(1) explicitly excludes:

“fees authorized by law related to the purchase or lease of a motor vehicle that are charged by a motor vehicle dealer.”

The FTC’s position raises an unresolved issue: if Minnesota law allows certain dealer fees to be disclosed separately, but the FTC expects all required fees to be included in the advertised price, which standard applies?

There is no definitive answer yet. Federal law (FTC Act) can preempt state law in certain circumstances, particularly where state law permits conduct that federal law prohibits. How the FTC will apply this in states like Minnesota remains unclear.

While we await further guidance, dealers should note the direction of federal enforcement:

• The FTC emphasizes “all-in” pricing

• Enforcement increasingly targets fee disclosures and add-ons

• Even long-standing industry practices are being re-examined

MADA is analyzing the FTC’s letter and its potential impact on Minnesota dealers, including whether and how federal expectations could override or reshape existing state law frameworks.

Meanwhile, the National Automobile Dealers Association (NADA) continues discussions with the FTC and state dealer associations to seek clarity and advocate for workable standards.

MADA will monitor developments and provide guidance as we learn more.