Auto Leasing Rules Revamped Manufacturers Agree To Prominently Disclose All Leasing Costs

Lease a car for just a penny down? Nice, but don’t count on it, the government said Thursday in announcing that five major automakers have agreed to stop burying important leasing costs in the fine print at the bottom of their advertisements.

From now on, details of those costs - such as taxes, title and registration fees - must be displayed as boldly as the print that blares “Zero Down,” said Federal Trade Commission Chairman Robert Pitofsky.

“These disclosures are important and add hundreds and thousands of dollars to the cost,” he said at a news conference. “The problem is they are not readable and they are not understandable.”

The agreements with the FTC require General Motors Corp. and the U.S. subsidiaries of Honda, Isuzu, Mazda and Mitsubishi to include clear and understandable cost information in their nationwide advertising.

One-third of all new cars in this country are leased and the total is expected to grow to half by the turn of the century, said Mary Ponder of the Consumer Federation of America.

Leasing is an appealing alternative among shoppers who can’t afford to buy a new car, the average price of which has climbed to $21,600, said the National Automobile Dealers Association. Monthly payments for a new car can be up to 50 percent higher than the monthly cost of a leased vehicle.

But car leases also have led to a growing number of consumer complaints as shoppers gripe that they often don’t know before they get to the showroom how much it will cost to drive away a new set of wheels.