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FTC: State’s Sunday car sales ban could lead to higher prices

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Illinois

* State Sen. Jim Oberweis asked the Federal Trade Commission to comment on his legislation to repeal the Sunday car sales ban. After a vote by the FTC, the Federal Trade Commission’s Office of Policy Planning, Bureau of Competition, and Bureau of Economics responded…

The existing Code provisions effectively ban the sale or long-term lease of both new and used automobiles (except private sales) on Sunday throughout Illinois. They therefore eliminate the possibility of competition among dealers to determine the hours of operation on Sunday that might be most responsive to consumer preferences and most beneficial to automobile dealers.

Further, because automobile dealers also provide repair services and sell replacement parts, the probable effects of mandatory Sunday closing laws extend beyond vehicle sales. The principal harms to competition from such laws likely include:

(1) increased consumer search costs that impede comparison shopping;

(2) a market that is unresponsive to consumer preferences for hours of operation; and

(3) diminished competition among dealers for both automobile sales and a range of related services.

Collectively, these effects may lead to higher prices and reduced output for sales of new and used automobiles and related automobile services than would otherwise be the case.

* From Oberweis…

“Since 1983, car dealerships in Illinois have been forbidden to be open on Sundays under penalty of a $1500 fine,” Oberweis said. “A majority of states allow automobile sales on Sundays, and car dealers in Illinois should be free to choose whether they wish to be open or closed on Sundays without government interference.” […]

“This analysis and recommendations from the FTC bolster the argument for repealing this ban. Senate Bill 2629 should not be bottled up in committee. It should be sent to the Senate for full, public legislative debate,” Oberweis said. “We need to rethink the weak argument that car dealers should be closed Sundays to give their employees a day off and keep costs down. Plenty of other employers and stores set their hours – with full consideration of what their competition is doing – without input from the government.”

posted by Rich Miller
Friday, Mar 28, 14 @ 2:16 pm

Comments

Oberweis is dead-on-right. I can’t believe this is even an issue for debate.

Comment by Just Observing Friday, Mar 28, 14 @ 2:19 pm
I know a handful of Automobile Dealers, they are not in favor of this. Many believe they get a lot of business from people coming on Sunday to look at cars without being bothered.

What’s next keeping them open for 24 hours?

Comment by He Makes Ryan Look Like a Saint Friday, Mar 28, 14 @ 2:29 pm
===What’s next keeping them open for 24 hours? ===

You are confusing the proposed repeal of a state-mandated closing day with state-mandated opening hours. It’s not a sound argument. Please, don’t do that again.

Comment by Rich Miller Friday, Mar 28, 14 @ 2:31 pm
Two times ina row obwerweis makes sense. HMRLLaS, are you just impulsively antiOberweis? It makes perfect sense as a lot of people are off the weekends and can take the day off.

Comment by Wumpus Friday, Mar 28, 14 @ 2:33 pm
Don’t they still sell cars on sunday, just not on their own lot? Like a sunday tent sale. Or do they technically fill out the paperwork the next day?

Comment by Cabildero Friday, Mar 28, 14 @ 2:33 pm
This is one of those times when the business guys want government regulation so they don’t have to do the heavy lifting. I see no reason for the state to interfere with Sunday sales. That being said, the Solons won’t buck the business guys on this. Another loser for the milkman.

Comment by Norseman Friday, Mar 28, 14 @ 2:35 pm
I agree with the first part of what He makes… Had to say. Whenever I start looking for a car, I go visit lots on Sunday so I can compare in peace. That being said, I really do not care if they repeal the law or not.

Comment by G'kar Friday, Mar 28, 14 @ 2:35 pm
Everything else is sold on Sundays. Why not cars? Why is this even a debate?

Comment by Left Leaner Friday, Mar 28, 14 @ 2:38 pm
Personally, I hate shopping for cars. When I need one I go visit the lots on Sunday to avoid the pressure and hassle of salespeople. I’ll talk to the salesperson once I have an idea about what I want.

I also have a brother-in-law who sells cars. He hates the idea — it will mean more hours per week without an increase in pay. People aren’t buying fewer cars because a dealership is closed; they just wait until Monday.

Comment by Stuff happens Friday, Mar 28, 14 @ 2:39 pm
And so I don’t draw Rich’s ire, I understand that the dealerships aren’t being forced to open. But when the big dealership down the street decides to do it, other dealerships will have to follow suit to remain competitive.

Comment by Stuff happens Friday, Mar 28, 14 @ 2:42 pm
Last comment; I’m spamming the boards.

So my input is purely ‘how I feel’. From a legal standpoint, it doesn’t make sense to close dealerships on Sunday.

But the fact that they’re changing things makes me really glad that I don’t sell cars for a living.

Comment by Stuff happens Friday, Mar 28, 14 @ 2:44 pm
It’s to promote the quality of family life for salespeople who want to be with their families on Sundays. I think dealers are probably split on the issue, with large dealerships in favor of being open.

Comment by gesquire Friday, Mar 28, 14 @ 2:47 pm
I was present in 1983 when the bill effectively banning Sunday sales was passed. Proponents pointed to the fact that there had been some problems with obtaining financing approval on Sundays and in some instances people had purchased cars, driven off the lot and the financing had not gone through on Monday morning, leaving the dealer with a (now) used car - if they got the car back at all. Proponents also said that some dealers who wanted to close on Sunday were at a competitive disadvantage to other dealers who chose to remain open. Since there was really no opposition to the bill that I can recall, I think the thing sailed out of both the House and Senate and was signed by Governor Jim Thompson. I’m not saying it was the right thing to do…just the history.

Comment by Commonsense in Illinois Friday, Mar 28, 14 @ 2:48 pm
More hours without an increase in pay? Your bro in law must not be a very good salesman.

Comment by Westward Friday, Mar 28, 14 @ 2:49 pm
Leave well enough alone.

Comment by John A Logan Friday, Mar 28, 14 @ 2:51 pm
Would be curious how the new car dealers trade group here in Illinois comes down on this..

Heck purchased a car once from a dealer further away because the closer dealer had closed for the day.

Comment by OneMan Friday, Mar 28, 14 @ 2:55 pm
===curious how the new car dealers trade group here in Illinois comes down on this===

They passed the law in the first place.

Comment by Rich Miller Friday, Mar 28, 14 @ 3:04 pm
== They passed the law in the first place. ==

Yeah but opinions change over 20 years… The financing issue is likely gone since I suspect it isn’t humans making that call anymore but machines.

Comment by OneMan Friday, Mar 28, 14 @ 3:06 pm
Jim and I agree on this

Comment by Dozer Friday, Mar 28, 14 @ 3:07 pm
No Brainer.

Why even ask the FTC, it’s simple market dynamics? I thought Republicans understood market economics.

Comment by Walker Friday, Mar 28, 14 @ 3:09 pm
You go Jim! You’re still only getting 42% in the General.

Comment by Yellow Dog Democrat Friday, Mar 28, 14 @ 3:09 pm
===Yeah but opinions change over 20 year===

Um, no. It’s why the bill hasn’t moved an inch since Obie-wan introduced it.

Comment by Rich Miller Friday, Mar 28, 14 @ 3:10 pm
The last new car I bought was just across the border in Wisconsin, but it had NOTHING to do with hours of operation.(It was a Thursday evening.) It had EVERYTHING to do with price. About 12% lower then the lowest price I was quoted locally.

Comment by DuPage Friday, Mar 28, 14 @ 3:11 pm
My intent was not to comment again, but I need to respond to the salesmen issue. I’m not insensitive to the overwork concerns of the sales force, but there are other folks are similarly situated and I’m aware of the state forcing the closure of their employers. I believe that State policy needs to be consistently applied to all.

Comment by Norseman Friday, Mar 28, 14 @ 3:19 pm
I never really understood dealerships being closed on Sundays. I would venture to guess that the weekends are when most consumers are available to car shop. Can someone enlighten me as to the original reasoning for the legislation? Is it to level the playing field and allowing dealers to close one day per week or was there some other agenda?

Comment by Stones Friday, Mar 28, 14 @ 3:27 pm
=== Yeah but opinions change over 20 years… The financing issue is likely gone since I suspect it isn’t humans making that call anymore but machines. ===

Changing opinions is verboten in Springfield, it’s called flip flopping.

Comment by Norseman Friday, Mar 28, 14 @ 3:34 pm
When the law passed during another recession 30 years ago, it was a way for car dealers to reduce overhead without being put at a disadvantage compared to the competition. It was a law passed to help out a struggling industry as a whole, at the dealers’ behest.
Repealing the law probably benefits the big dealerships, and ultimately may reduce competition if the added cost of being open on Sunday contributes to the demise of some dealerships.

Comment by Noper Friday, Mar 28, 14 @ 3:36 pm
== Um, no. It’s why the bill hasn’t moved an inch since Obie-wan introduced it. ==

Asked and answered then…

As for blue laws in general, grew up next to South Holland who had a ton of them and they still had nicer retail and more car dealerships than other towns nearby.

Comment by OneMan Friday, Mar 28, 14 @ 3:59 pm
I prefer Oberweis making these kinds of proposals to an Oberweis making bizarre kinds of proposals.

Comment by VanillaMan Monday, Mar 31, 14 @ 9:33 am
I Like To Rest On The Sabbath, And Also Attend
Church And Be With My Family. So Many Big Problems
For Him To Focus On This?

Comment by Car Guy Monday, Mar 31, 14 @ 6:39 pm
How Many Cars Do People Buy In A 5 Year Or 7 TO
10 Year Time Frame? Do You Think Its To Much
To Ask Them To Find The Time To Buy Monday To Sat In One Of Those 5 To 10Years ? What About Real
Issues. Like Caterpillar Avoided 2.4 Billion
Dollars Because of Loopholes In The Tax Law Or
General Electric Paid No Tax, Or Medicaid Fraud
Foreign Aid To Nations That Hate The USA. O By The
Way Jim Soc Sec Is Going Broke. Flood Ins.Your Focus Car Dealers Should Be Open On The Sabbath

Comment by Car Guy Tuesday, Apr 1, 14 @ 2:53 pm