Navigating New Pricing Transparency Laws for Dealerships

In California, the Honest Pricing Law SB 478 mandates that businesses include all fees in the advertised price of goods and services, except for government taxes and reasonable shipping charges. The new law aims to eliminate deceptive pricing practices and promote transparency, which will help consumers avoid unexpected costs at checkout and create more informed purchasing decisions. Businesses must now integrate service fees into the advertised price, ensuring that the price a consumer sees is the price they pay. This law applies to purchases such as ticketing, hotel stays, and food delivery services; however, certain sectors, such as motor vehicle dealerships, do not need to follow these rules when advertising the MSRP of their inventory. Failure to comply with the Honest Pricing Law could lead to lawsuits from the California Attorney General’s Office and private lawsuits under the Consumer Legal Remedies Act.

Despite California’s Honest Pricing Law excluding motor vehicle dealerships, California’s CARS Act takes aim at dealerships and will be effective on July 1, 2025. This bill requires that dealerships do not make any misrepresentations of material information about the sale of the vehicle including: the costs or terms of purchasing, financing, or leasing a vehicle, the availability of vehicles at an advertised price, and the remedy available if a dealer fails to sell or lease a vehicle at the offering price.

In Illinois, “The Junk Fee Ban Act,”  Senate Bill SB1486 was introduced on January 31, 2025, by Senator Omar Aquino. This act seeks to enhance pricing transparency by amending the Consumer Fraud and Deceptive Business Practices Act. As of today's date, SB1486 is under consideration in the Illinois Senate. If enacted, this legislation would protect consumers from hidden fees and promote fair business practices in Illinois. While there has yet to be legislation in the proposed Junk Fee Ban Act that excludes dealerships, it will be important to look for future updates on this bill, as Illinois is quickly becoming a hub for vehicle innovation and automotive plant expansion.

Lavelle Law can assist dealers in defending against claims brought by consumers. For further questions, please contact attorney Sarah Reusché at sreusche@lavellelaw.com or (847) 705-7555.