NPDA Industry Update: Important FTC Advertising Guidance for Powersports Dealers
The National Powersports Dealer Association (NPDA) is committed to keeping powersports dealers informed about regulatory developments that can affect dealership operations, advertising practices, and relationships with consumers.
Recent FTC guidance provides important clarification on vehicle advertising practices that are directly relevant to powersports dealerships. While portions of the guidance use automobiles as examples, the issues addressed—including inventory availability, pricing transparency, third-party advertising, discounts, fees, and optional products—are important considerations for powersports retailers as well.
The NPDA recommends all powersports dealers review the guidance carefully, if necessary with their legal or compliance professionals, and consider how their current advertising practices align with these expectations.
The first important point involves units that are in transit.
Previous FTC statements suggested that vehicles should be advertised as “in transit” only when they were expected to arrive within a relatively small number of days. That approach does not necessarily reflect the realities of the powersports industry, where motorcycles, ATVs, side-by-sides, personal watercraft, snowmobiles, and other units may be allocated, shipped, or otherwise in transit for varying periods of time.
The latest guidance makes clear that the central issue is transparency with the consumer.
Dealers may advertise units that are in transit, provided the advertisement clearly communicates that the unit is not currently available on the dealership lot. When possible, dealers may also want to provide an anticipated arrival date or similar information to give customers additional clarity.
Likewise, dealers that combine new or pre-owned inventory from multiple dealership locations into a single website or advertising platform should clearly communicate where each unit is physically located.
In answer No. 10, the FTC states:
“To be clear, it is not deceptive in and of itself for a car that is not physically present on the lot to be advertised for sale. The key is transparency: consumers must not be led to believe the car is available on the lot if the car is not. If a vehicle is in transit or located elsewhere, the ad must plainly state that fact.”
For powersports dealers, the practical takeaway is straightforward: if an advertised unit is in transit or located at another dealership or store location, make that information clear to the customer.
The FTC also clarified that responsibility for advertising may extend beyond the dealership.
Third-party advertising providers and OEMs may also bear responsibility for deceptive advertising when they exercise control over the advertising. This is particularly relevant in powersports, where dealers frequently rely on OEM-provided inventory feeds, website providers, digital marketing companies, marketplaces, and other third parties to create, populate, or distribute advertising.
That makes it especially important for dealers to document the processes and controls they use to review their advertising and ensure information supplied or published on their behalf is accurate and compliant. Maintaining clear procedures can also help establish which party controls particular advertising content when questions arise.
In answer No. 12, the FTC states:
“In brief: everyone who has control over the advertising is responsible for making sure the ads state the actual price as the most prominent amount.”
The FAQ addresses several other advertising issues that powersports dealers should review, including discounts and rebates, document fees, optional products or accessories, advertised pricing, and other charges or conditions associated with the sale of a powersports vehicle.
These issues can be especially important in powersports, where advertised units may include OEM incentives, dealer discounts, freight or destination charges, setup or assembly charges, installed accessories, optional products, and other items that can affect the customer's final purchase price.
NPDA encourages every powersports dealer to review the complete guidance and evaluate its advertising practices with qualified legal and compliance professionals. Dealers should pay particular attention to how inventory availability and location are represented, how prices and discounts are displayed, and how advertising information is shared among the dealership, OEMs, website providers, marketplaces, and other vendors.
NPDA will continue monitoring developments affecting powersports dealers and will provide additional information and updates to the industry as they become available.
