First-in-the-Nation California Combating Auto Retail Scams (CARS) Act Takes Effect October 1. Includes 3-day cooling off period for used car buyers.

At a time when the prices for new and used vehicles have reached record-breaking highs, due to President Trump’s hiking tariffs on auto components, common car dealer scams, and other factors, the California Combating Auto Retail Scams (CARS) Act (SB 766), authored by California Senator Ben Allen, will make buying new and used cars in California more affordable and less risky – without costing taxpayers.

Leading economists project that the CARS Act’s truth-in-pricing mandate and new protections against worthless add-ons will save California car buyers an estimated $234 million annually in reduced search costs, plus another 8.5 million hours in time savings each year.

In addition to those savings, the California CARS Act also creates a new, history-making first-in-the-nation 3-day cooling off period for used cars that cost $50,000 or less, giving used car buyers the right to return vehicles for any reason for a full refund, minus a restocking fee between $200 – $600.

This new right will empower used car buyers in negotiating with car dealers, and help consumers, including rideshare drivers and many small businesses, avoid getting stuck with unfair deals or unsafe, defective cars. It will also help give dealers who don’t scam their customers a competitive advantage.

The Act is aimed at protecting California new and used car buyers from the #1 source of consumer complaints nationwide: auto sales and service. According to the Consumer Federation of America annual consumer complaint survey, auto sales, manufacturing issues, and service complaints have topped the charts of the top ten consumer complaints to state and local consumer protection agencies for the past ten years.

Key provisions in the CARS Act:

• Requires car dealers to disclose the “total price” up front and in advertising, including any add-on items installed by the manufacturer, making the actual “off the lot” prices more honest and transparent, and encouraging competition over prices
• Prohibits car dealers from requiring the purchase of add-on items that were not installed by the manufacturer, in order to buy the new or used car
• Requires dealers to disclose at the time of sale or lease that add-on items not installed by the manufacturer are optional
• Bans car dealers from charging extra for add-ons that “would not benefit” car buyers, including lifetime oil changes or catalytic converter markings for electric vehicles, and service contracts that are void due to pre-existing conditions, such as prior damage from a crash or flood or preexisting mechanical conditions
• Prohibits dealers from advertising or claiming they are affiliated with or endorsed by the U.S. military or any government agency
• Creates a new first-in-the-nation right to return a used vehicle that cost $50,000 or less within 3 calendar days for any reason for a full refund, minus a restocking fee between $200 – $600 (and sometimes other fees)

For FAQs and more information about the CARS Act and how to make the most of the new cooling off period, visit this page on CARS’ Website.