Dealers Watch As Asbury Automotive Pushes Back Against FTC

Dealers are closely watching the fight between megadealer group Asbury Automotive, Duluth, GA and the Federal Trade Commission for any lessons they can take away.

The FTC alleges three Asbury-owned dealerships in Texas of committing illegal sales practices, including racial discrimination. As of June 30, Asbury operated 155 new-vehicle dealerships. Asbury vehemently denies the accusations.

The FTC tentatively set an April 16, 2025, hearing at the commission’s Washington office. If the case isn’t settled before then, it would be a rare example of a dealer group choosing to fight a regulator rather than reach a settlement

“Importantly, this process could yield valuable ‘lessons learned’ that will be available for other dealerships, enhancing the value of this legal challenge,” says Linda Robertson, founder and executive director of the Association of Dealership Compliance Officers, a trade association based in Colleyville, TX.

For instance, Robertson says the legal challenge could be an opportunity for dealers and auto lenders to learn more about how, exactly, regulators determine whether sales practices result in a “disparate impact” against classes of people who are legally protected against discrimination, such as racial minorities, or women

It could also be valuable for other dealerships to learn whether Asbury’s internal compliance and customer complaint processes serve to reduce fines or win a measure of forgiveness, she says.

The FTC complaint alleges three Asbury dealerships — David McDavid Ford Fort Worth, David McDavid Honda Frisco, and David McDavid Honda Irving — charged customers for add-on products they didn’t authorize.

The complaint also says customers claim they were told the products were required as part of their purchase.

The FTC complaint states this "happened in financed transactions across each of the dealerships, with one charging Black consumers, on average, $298 more for the same add-ons and Latino consumers, on average, $214 more for the same add-ons than non-Latino White consumers."
The complaint alleges that Asbury Auto Group, the three dealerships, and Ali Benli — who acted as general manager of those dealerships —violated the FTC Act and the Equal Credit Opportunity Act.

The FTC also alleges that the dealerships' discrimination falls under disparate impact.

Disparate impact means that regulators don’t have to prove discrimination is intentional. To determine discrimination under disparate impact, it’s only necessary to prove that members of legally protected classes pay more than “similarly situated” borrowers who are not members of protected classes.

In a written statement published Aug. 16, the same day the FTC announced the charges, Asbury CEO David Hult says the charges are unfounded. He says Asbury can document that its sales practices are lawful.

“After carefully reviewing the dealerships’ records, Asbury…will contest the FTC’s lawsuit alleging violations related to the sale of what the FTC calls ‘add-on’ products and will defend the dealerships’ sales practices,” Asbury says in the statement.

Asbury also states, “FTC officials refused to provide the methodology they employed in making their allegations, even though Asbury requested such information for several months.”

A weak link in the disparate impact approach is that dealerships and auto lenders cannot collect data on customers’ racial identity.

If the complaint doesn’t get settled and the FTC must disclose more details on its analysis, the Asbury case could be more significant. Experts say that level of detail doesn’t get disclosed when cases get settled.

“We are confident that we will prevail in the litigation,” Asbury’s Hult says.

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