“Dealers have to discount those rates to be competitive. The current system saves customers money. Period.” – Forrest McConnell
Auto dealers and the federal government are facing off over proposed rules to regulate auto financing, and this week the head of the nation’s largest dealer lobby came out strongly against plans to tighten lending practices and extend federal oversight.
“The government is trying to take away the consumer’s right to get a discount,” said Forrest McConnell, chairman of the National Automobile Dealers Association. Speaking at an Automotive Press Association event in Detroit, McConnell said dealers need the ability to “discount” interest rates for auto loans.
“Dealers have to discount those rates to be competitive,” he said. “The current system saves customers money. Period.”
The government disagrees.
The Consumer Financial Protection Bureau wants to extend its ability to regulate auto financing and argues a move to a flat fee system for auto loans – rather than discretionary interest rates – would benefit consumers and allow for more transparency in the process.