California Car Buyers Achieve an Unexpected Victory Against Dealers Following Newsom's Decision | Carscoops

      The governor rejected a proposed increase in dealer fees of up to 600 percent, which he deemed unjustified, and enacted a new law that safeguards used car buyers in California.

      Gov. Gavin Newsom vetoed SB 791, preventing the increase in dealer processing fees, and he also endorsed SB 766, which extends the return period for used car buyers.

      Dealers expressed disappointment over the veto, while advocates celebrated it as a success.

      Car prices are continually rising, but California buyers are experiencing some relief. Back in June, we reported on a potential rise in dealer fees by over 600 percent. Now, not only has Governor Gavin Newsom vetoed that proposal, but he has also signed a new law enhancing consumer protection for used car purchasers.

      Senate Bill 791 initially aimed to increase the cap on dealer document processing fees from $70-$85 to as much as one percent of a vehicle's price, capped at $500. Eventually, legislators lowered that cap to $260. Nevertheless, the Governor ultimately declined to approve the bill.

      In his veto message, Newsom remarked that the fee increase was unreasonable considering it only covered a few minutes of data entry and that significantly raising the fee beyond what inflation would justify would place an unfair burden on consumers already facing high expenses. “For these reasons, I cannot sign this bill,” he stated.

      It's not surprising that California’s influential dealer lobby isn’t pleased with this outcome. Brian Maas, president of the California New Car Dealers Association, expressed disappointment to Cal Matters, noting that the state's $85 cap is the lowest nationwide. He contended that dealers are dealing with increasing regulatory costs that cannot be recovered due to the fixed cap.

      As if that weren’t enough frustration for dealers, Newsom also signed Senate Bill 766 into law, instituting extensive consumer protection regulations.

      Beginning October 1, 2026, used car buyers statewide will have three days to return their vehicle for a full refund, provided its sale price is below $50,000. Dealers are permitted to charge a restocking fee.

      SB 766 also prohibits misleading add-ons, such as oil changes for electric vehicles, and mandates that all costs be transparently disclosed to buyers upfront. Advocates assert that these measures represent a significant victory. Rosemary Shahan of Consumers for Auto Reliability and Safety referred to these actions as “huge wins for California car buyers.”

      This week, @CAgovernor signed SB 766 — the Combating Auto Retail Scams (CARS) Act— into law. Sponsored by Sen. Ben Allen, with support from Professor Ted Mermin, Senior Fellow Sam Levine, and others, SB 766 bolsters protections for Californians purchasing or leasing vehicles.

      — UCB Center for Consumer Law & Economic Justice (@UCBConsumerLaw) October 8, 2025

      Credit: Gavin Newsom