ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Saturday, December 7, 1996 TAG: 9612090007
SECTION: BUSINESS PAGE: A-7 EDITION: METRO
SOURCE: JEFF STURGEON STAFF WRITER
A state regulator apologized Friday to a Roanoke auto dealer for letting it use advertising that didn't comply with consumer protection policies.
The state Motor Vehicle Dealer Board said it incorrectly approved a newspaper advertisement last month for a "$5 Used Car Sale" that didn't tell consumers what they would be getting for their money.
The state requires dealers who advertise vehicles at a specific price to give the year, make and model of each, said Peggy Bailey, office manager in RIchmond of the state Motor Vehicle Dealer Board. Bailey is spokeswoman for the agency administering state regulations of auto dealers.
Advertising placed by First Team Auto Mall for the Nov. 23 sale omitted descriptions of the $5 vehicles, saying simply their number would be limited.
First Team Auto Mall wasn't found to be in violation of any law or disciplined in any way, because a state employee approved the ad before it was published in The Roanoke Times, Bailey said. Normally, dealers found in violation receive a warning letter on the first offense. The law provides for fines of $500 and $1,000 for second and third offenses of the same kind.
"I will be writing to First Team Auto Mall to let them know that their advertisement was not correct and apologize for our error," Bailey said to the newspaper.
George Pelton, president of First Team Auto Mall, said his company relied on the state to know the law. The state's advertising law for auto dealers is complex, he said.
At the event, the dealership had about 75 cars and trucks from the 1980s to early 1990s on the lot. Two hours before the sale began, the lot was opened for customers to inspect the vehicles, most of which did not have prices posted. A flier - handed out as the 150 customers showed up - said two or three of the cars would be offered for $5 but didn't say which ones. The flier said all the vehicles would be bargains. Customers were to wait behind the wheel of the car or truck each wanted to buy.
It was a style of promotion that has been used in other markets, but rarely in the Roanoke Valley.
Two customers drove away with vehicles for which they paid $5: a 1990 Hyundai Excel, and a Chevy Celebrity with more than 117,000 miles. Both had failed safety inspections and needed mechanical work to be driven more than 15 days.
Bailey said vehicle descriptions in the newspaper ad would have told consumers before the sale about the merchandise to be sold and would have helped consumers who attended "easily identify the $5 vehicle."
Pelton continued Friday to defend the promotion. "The gist of the ad was, the reason people would come in is they didn't know which cars were for $5, right?" He said he felt he had the right to run the ad because it had been approved by the state dealer board.
Neither Pelton nor Bailey would release the contents of a letter she sent Pelton Thursday.
Even after receiving the state's letter, Pelton said Friday he remained unsure the state agency's new interpretation of his ad was correct. He added: "Was the public harmed? Absolutely not. Was there any intention to harm? Absolutely not."
After the sale, the board took a second look at the ad because of a complaint by Berglund Chevrolet Geo Jeep Eagle Buick of Roanoke, Bailey said. She added that it is common for Virginia auto dealerships to raise questions about each other's advertisements.
"Ninety-five percent of the complaints we get are from within the dealer community," she said. "They are a tremendous watchdog on themselves."
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