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Dealers file suit against TrueCar




TrueCar's logo is displayed on the Nasdaq billboard in Times Square on May 16, 2014 in New York City.
TrueCar's logo is displayed on the Nasdaq billboard in Times Square on May 16, 2014 in New York City.
Andrew Burton/Getty Images

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The California New Car Dealers Association filed a lawsuit this week against Santa Monica auto sales service company TrueCar, claiming the company violates various laws that govern car sales in the state.

TrueCar is an online service that’s changing the historic model of car buying.  TrueCar links car buyers with dealers who bid to supply the vehicle requested.  It saves the buyer from having to run all over the region to get quotes. However, the dealers claim the way TrueCar is compensated makes it a dealer, requiring state licensure.

Will services like TrueCar break down the dealership model? Will buyers largely be purchasing cars online? What will the role of car dealerships be if models like TrueCar take over?

Guests:

Patricia Glaser, Attorney representing California New Car Dealers Association (CNCDA) and Partner and Chair of the Litigation Department at Glaser Weil. 

Johnny Stephenson, chief risk officer at TrueCar.