Is It Legal For A Dealer To Refuse Business Because I Live In A Certain State?

Also, will a dealer be more motivated to discount if you buy two cars?

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Image: Mercedes Benz

As Jalopnik’s resident car-buying expert and a professional car shopper, I get emails. Lots of emails. I’ve picked a few of your questions and will try to help out. This week we are discussing if it’s “legal” for a dealer to refuse business based on the state you live in, and if buying two cars at once will result in a better deal.

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First, is it “discriminatory” for a dealer to deny a sale to a Montana resident?

I recently switched residency to the state of Montana and obtained a driver’s license there. I told my long-time auto-broker (who orders and negotiates car purchases/leases for me) that I wanted to order a new Mercedes GLE53 for my wife a while ago. Long story, short, the auto-broker told me that the car is arriving this week. I sent over info requested and he came back to me saying that the dealer informed him that they have a policy that they don’t sell to anyone in Montana because car exporters frequently incorporate in Montana due to no sales tax. Oddly enough, when we ordered my wife’s 2014 Mercedes ML350 Bluetec with Designo way back in 2013, the same dealership also suspected that we are car exporters but ultimately ended up doing the lease at the time. We never exported that car and do not engage in auto-export. I run an IT business full-time. To me, it seems it can’t be legal that a business can refuse to do business with anyone from a certain state in the union but I am not sure and that is why I am writing to you. Have you heard of policies like this before?

So when we talk about dealers doing “illegal” things we need to examine exactly what laws they would be breaking. Dealers have to abide by various financial, and contractual laws, but what you are alluding to here is a dealer that might be violating a law regarding discrimination. A dealer cannot discriminate based on race, gender, religion, sexual orientation, and so on, but someone residing in Montana is not part of any of those groups. Dealers can deny sales for almost any reason and it can be as simple as “this is too much hassle for us.” If this Mercedes store has gotten burned in the past from Montana sales they are well within their rights to avoid such headaches on future sales even if you are a legit buyer.

Next up, would buying two cars at once result in a much better deal?

“My wife and I are having our 2nd child in December, and we’re in the market for a minivan. My inlaws are retired and want to drive to DisneyWorld at-least-once and are also in the market for a minivan.

My inlaws are pretty thrifty people, and they have been pitching an idea to me for a few weeks: “When you go shopping, take us, and we’ll buy 2 minivans at the same time. They’ll have to give us a good deal!”

Is this even a thing? Would a dealer really cut a more favorable deal if you came in guaranteeing them that you’re about to buy two cars at once?”

This isn’t really “a thing.” First of all, given the current inventory situation, a dealer may not even have two minivans in stock that match your requirements. Furthermore, dealers typically aren’t worried about guaranteeing a sale of two cars today to one family versus one car to you and another to someone else the next day. In either case, they have still sold both cars in the same month. My experience has been that regardless if you are buying one car or two, a dealer will either offer you a competitive deal or they won’t. Purchasing two at once doesn’t really give you leverage, comparing prices among several dealers is what gets you the best price.

Got a car buying conundrum that you need some assistance with? Email me at tom.mcparland@jalopnik.com!

DISCUSSION

By
Chicago-Craig

Hey, Tom.

Why would the dealer care if the car was exported? I’m obviously missing something here. In my business, we have to worry a bit about export controls, but that’s not the case here. Is it more that gray market exports to Europe undercut local pricing?