FTC Extends Car Warranty Dispute Collection Rule
Published Date: 4/17/2026
Notice
Summary
The Federal Trade Commission wants to keep its rule that helps car makers and others settle warranty disputes without going to court for three more years. This affects companies using informal dispute systems and asks the public to share thoughts by June 16, 2026. The rule involves about 11,700 hours of work yearly and costs around $765,000, keeping things fair and smooth for everyone.
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Analyzed Economic Effects
3 provisions identified: 0 benefits, 2 costs, 1 mixed.
Continued Annual Compliance Burden
If you run an informal dispute settlement mechanism (IDSM) or are a warrantor that uses one, the Rule creates an estimated annual paperwork burden of about 11,738 hours and total annual costs of about $339,496 in labor plus $425,987 in non-labor costs (about $765,483 total). The FTC is seeking to extend OMB clearance for these information-collection requirements for three more years, and the current clearance expires on July 31, 2026.
Automakers' Disclosure Time and Costs
The FTC estimates there are about 34 automobile manufacturers covered by the Rule, and each manufacturer is assumed to spend about 30 hours per year creating, revising, and distributing required informational materials, for a combined annual disclosure burden of 1,020 hours. The FTC estimates warrantors' disclosure labor costs of $103,700 per year.
Consumer Access and Prior-Resort Requirement
If a product warranty includes a prior-resort clause, consumers are required to use the informal dispute settlement mechanism (IDSM) before going to court; those IDSMs must meet Rule standards (structure, staff qualifications, procedures, recordkeeping, and annual audits) and must provide written operating procedures and records on request. IDSMs are permitted to charge consumers for copies, with copying costs estimated at $0.18 per page.
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