California Combating Auto Retail Scams (CARS) Act.

Senator Allen's proposed California Combating Auto Retail Scams (CARS) Act introduces comprehensive regulations governing vehicle sales practices and consumer protections in California. The legislation establishes new requirements for auto dealers regarding pricing transparency, add-on products, and cancellation rights.

The bill mandates that dealers provide clear disclosures about vehicle pricing, financing terms, and optional add-on products or services. Dealers must disclose the total purchase cost when advertising monthly payments and cannot charge for add-on products that do not benefit the consumer. The legislation also requires dealers to maintain detailed records of advertisements, sales documents, and customer communications for seven years to demonstrate compliance.

For used vehicle transactions, the CARS Act creates a 10-day cancellation right for purchasers and lessees. Dealers must provide written notice of this right and cannot impede customers from exercising it. The bill establishes specific procedures for processing cancellations, including refund requirements and restrictions on restocking fees. Dealers must prominently display notices about these cancellation rights in sales offices and areas where contracts are executed.

The legislation amends existing vehicle codes to align with these new requirements while repealing outdated consumer protection provisions. It modifies tax code sections to exclude refunded amounts from gross receipts calculations and updates regulations on catalytic converter marking to prevent theft. The CARS Act specifies that violations constitute unfair business practices actionable under state consumer protection laws.