US FTC sues auto dealer group Asbury Automotive for charging Black, Latino customers more

WASHINGTON: The US Federal Trade Commission sued Asbury Automotive Group on Friday, alleging that three of its dealerships in Texas charged Black and Latino customers higher prices than others, and routinely added services to customers' contracts without their consent.

Up to 75 percent of customers of David McDavid Ford dealership in Fort Worth, and Honda dealerships in Irving and Frisco, Texas, reported being charged without their permission for services such as protective coatings, service contracts and insurance, according to the agency.

In some cases, customers had declined the services or been falsely told they were mandatory, while in others their permission was never sought, the FTC said.

The dealerships on average also charged Black customers US$298 (RM1,321) more, and Latino customers US$214 (RM949) more for the same add-ons than they did white consumers who were not Latino, the FTC said.

Asbury operates more than 155 dealerships in more than a dozen states. A spokesperson for the company did not immediately respond to a request for comment.

The company intends to fight the allegations, according to a statement by Andrew Ferguson, one of two Republican FTC commissioners.

Ferguson said the case was similar to one the FTC settled on Thursday against an Arizona dealership, and complained that the agency had used the settled case to classify discrimination as an unfair business practice.

FTC chair Lina Khan and the Democratic commissioners said on Thursday that exempting discriminatory conduct from unfair practices would give companies that discriminate a pass.

All five commissioners voted to authorise both cases.