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Toronto, August 21,
2009 – The Ontario Motor
Vehicle Industry Council (OMVIC)
advises consumers to be cautious
of dealer advertisements that may
offer “Cash for Clunkers”. In
Ontario, dealer advertising that
leads consumers to believe they
will receive a rebate is
considered a misleading and
deceptive practice.
Cash for Clunkers (officially
named the
Car Allowance Rebate
System) is a U.S.-based federal
program that offers consumers a
rebate towards a new purchase
when retiring older model
vehicles in the United States
only. Although Canada does have a
vehicle recycling program (Retire
Your Ride, www.retireyourride.ca)
it does not fall under the U.S.
program and Ontario does not have
its own “Cash for Clunkers”
rebate system.
All motor vehicle dealers and
salespeople in Ontario must be
registered with OMVIC and carry
on business in accordance with
the law and with honesty and
integrity. Registrants must
adhere to consumer protection
legislation, namely the Motor
Vehicle Dealers Act and Consumer
Protection Act, and are also
expected to observe OMVIC’s
Standards of Business Practice,
which include strict advertising
and marketing guidelines.
“OMVIC’s marketing standards
govern advertisements for both
new and used vehicles in Ontario
and level the playing field for
consumers and dealers,” explains
OMVIC spokesperson Brenda
McIntyre. “The purpose of the
standards is to ensure
advertisements are free of false
statements, empty promises and
deceptive representations of
products or services. Among other
things, advertising a “Cash for
Clunkers” program violates
Section 3.12.1 of the Standards
which states advertisements do
not offer a minimum trade in
allowance.”
To assist consumers with their
vehicle purchases, OMVIC offers
additional advice for reviewing
ads:
Additional Fees
Review ads carefully, especially
when comparing deals. The vehicle
price listed in an advertisement
is probably not the entire cost
of the vehicle. Factor in
administration costs when looking
at vehicle ads. “Administration”
fees, also known as
“documentation fees,” can be
catch-alls for a variety of the
dealer’s paperwork costs, and can
range up to several hundred
dollars.
Steer Clear of Prohibited
Words
Terms such as “going out of
business,” “closing,” “bankrupt,”
“fleet sale,” “factory price,”
“invoice prices,” “supply
limited” or “limited time only”
imply a vehicle is being sold
outside of regular business
practices. Dealers can’t use
these terms without a full
explanation of the situation.
Also, dealers whose names include
the word “wholesale” are, in
reality, retail dealers selling
at retail prices.
Verify All Fleet Vehicle
Disclosures
Late model vehicles offered at an
attractive price may be former
rentals. Dealers are required to
disclose former daily rentals,
taxis and police crusiers in
writing, and must also disclose a
vehicle’s accident history.
Classified Advertisements
Some people prefer to buy
privately, but be aware that
studies have shown more than 25%
of classified ads may be posted
by curbsiders (unregistered
dealers posing as private sellers
who sell misrepresented vehicles
to unsuspecting consumers). When
you buy privately, you’re on your
own with very little recourse if
you discover the car has been
misrepresented to you.
About OMVIC
OMVIC licences and regulates
motor vehicle dealers in Ontario
and enforces the Motor
Vehicle Dealers Act on behalf of
the
Minister of Consumer
Services. OMVIC’s mandate is to
maintain a fair, safe and
informed marketplace by ensuring
registration of dealers and
salespeople, inspecting
dealerships, maintaining a
complaint line for consumers,
conducting investigations and
enforcing the act and its
associated rules and
regulations. OMVIC is also
responsible for administering
the Motor Vehicle Dealers
Compensation Fund on behalf of a
Board of Trustees.
For more information, please
contact:
Brenda McIntyre
Communications Coordinator
T: 416-512-3167
Email:
Brenda.McIntyre@omvic.on.ca
Web:
www.omvic.on.ca
The OMVIC Standards of
Business Practice can be viewed
here.
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