CarGurus is defending itself against a lawsuit brought by the New York City Department of Consumer and Worker Protection, which alleges the car marketplace deceived shoppers by labeling listings as "Good Deal" or "Great Deal" while concealing mandatory fees. The agency said it found more than 2,000 violations during its probe and filed suit in New York State Supreme Court seeking injunctive relief and civil penalties. The regulator described this conduct as bait and switch pricing that can leave buyers paying substantially more than advertised.
DCWP cited an example in which a vehicle listed as substantially below market value was tagged a great deal, but an itemized disclaimer revealed mandatory fees that turned the listing into a price above market value. The agency also reported an analysis of tens of thousands of listings that showed listed prices were marked up on average by about $1,100 in mandatory fees. Officials said an AI chatbot on the CarGurus site further amplified confusion by generating lists of deals that may not reflect final purchase costs.
CarGurus rejected the allegations in a statement from CEO Jason Trevisan, saying the company pioneered price transparency and that its Deal Ratings objectively evaluate list price versus similar vehicles. Trevisan highlighted the site’s deal ratings, price change history, verified dealer reviews, and vehicle history reports as tools that help shoppers. He said the company has worked with regulators and industry partners and will defend itself vigorously.
The regulator noted prior enforcement activity in the used car sector, saying it has investigated more than 100 dealerships and secured consumer restitution. DCWP framed its lawsuit as an effort to stop hidden fees and ensure that labels such as great deal actually reflect lower total cost for consumers.
CarGurus Product Changes And Dealer Tools
CarGurus has introduced new dealer tools and tightened listing requirements as it expands its marketing products. The company described VINMax, a predictive marketing product that uses marketplace data to identify VINs that would benefit from extra exposure and to boost listings automatically on and off the site. CarGurus reported VINMax-boosted vehicles sold faster and generated more daily leads than comparable non-boosted listings.
CarGurus said VINMax complements PriceVantage and Shopper Signals, forming a toolkit that helps dealers price, promote, and target inventory. Ben Kasdon, vice president of dealer product management, said the products help dealers act earlier on underperforming vehicles and capture demand on high-value stock. The company also pointed to recent policy changes that require dealers to disclose mandatory fees to retain Deal Ratings and to display badges indicating when a price includes fees.
DCWP maintains CarGurus did not adequately enforce its own guidelines and that enforcement gaps allowed misleading listings to persist. CarGurus said it uses a Trust and Safety team, combining AI tools and human review, to remove or relabel listings and to penalize noncompliant dealers. The lawsuit will test whether those measures meet regulators’ standards and could lead to further changes in online vehicle advertising and platform oversight.
