Buying a New Car: Advertising

Posted on Apr 1, 2013 in Cars, RICO

1-15-13 [RICO]

Don’t let a misleading car advertisement steer you wrong.

Hawaii law makes it illegal for car dealers to use certain terms when advertising new and used cars.  Specifically, terms or phrases that may mislead consumers into believing that what they’re getting is a bargain, when in fact, it’s not.

Words such as ‘wholesale,’ ‘free,’ ‘invoice price,’ ‘fleet,’ ‘factory sale’ or ‘factory outlet’ can’t be used.  Words or phrases with similar meanings also can’t be used.  For example, because the phrase “at no charge” means the same thing as “free,” dealers can’t use that phrase in ads.

Additionally, where a discount or savings is featured, that discount or savings must be calculated in relation to the Manufacturer’s Suggested Retail Price or MSRP.  If an ad says that you, the consumer, will save $5,000 on the purchase of a car, the calculation of the savings must be based on the MSRP, not an inflated sales price that may make you think you’re getting a discount when you really aren’t.

Other highlights of the law:

  • Any advertised product must be available on the stated terms, either from inventory, or by order with delivery, within a reasonable time period.  So, before a specific car is advertised, it has to be available and able to be sold.
  • And, all guarantees, or words with a similar meaning, must be in writing, and must be included in your  sales contract.

Buying a car can be exciting!  RICO encourages all consumers to pay close attention to advertisements and make sure you’re headed in the right direction!

For more information on these and other topics, visit the State’s website at or call the Consumer Resource Center at 587-4272.