CAR DEALERS GET SLAP ON WRIST FOR GANGING UP ON NEWSPAPER
By Adnews Staff
The U.S. Federal Trade Commission got on the back of the Santa Clara County Motor Car Dealers Association after the car dealers' group applied its ad muscle to a local newspaper. The federal body took action after accusing the the association of "conspiring to restrain trade and deprive consumers of truthful information." Last year members of the association pulled advertising from The San Jose Mercury News because of an article telling car shoppers how to negotiate lower car prices. While the association agreed to stop the ad boycott as part of a settlement with the government, the dealers did not admit to any violations of the law. The is the first time the government has formally acted against an advertiser pulling its ads from a news publication. The dealers' action raised antitrust concerns for two reasons, according to Mark Whitener, the FTC official who headed a probe of the affair. It deprived consumers of essential price information in the form of newspaper advertising, and it was designed to stop the publication from publishing similar stories in the future. The newspaper estimates it lost about $1 million(US) over several months when the dealers pulled their ads. It got many of them back after offering them discounts on advertising and running an ad with the headline "Ten Reasons Why You Should Buy or Lease Your Next New Car From a Factory Authorized Dealer".