North Carolina House Bill H447

North Carolina 2023-2024 Regular Session

• Introduced: 3/22/23
• Refer: 3/23/23
• Report Pass: 4/26/23
• Refer: 4/26/23
• Engrossed: 4/27/23
• Refer: 4/27/23
• Refer: 6/26/23
• Report Pass: 6/27/23
• Refer: 6/27/23
• Report Pass: 6/28/23
• Refer: 7/11/23
• Enrolled: 8/16/23
• Chaptered: 8/24/23
• Passed: 8/24/23

Caption

Clarify Motor Vehicle Dealer Laws

Impact

The bill notably prohibits manufacturers from implementing practices that undermine the role of franchised dealers. For instance, it prevents manufacturers from restricting retail customers from negotiating sale prices or using financing options directly through local dealers. Additionally, the bill fosters a more competitive environment by requiring that dealers have access to a reasonable stock of new vehicles, facilitating better consumer choice and enhancing market competition. Overall, this legislation is designed to fortify the position of dealerships in North Carolina, ensuring they can participate effectively in the automotive sales market.

Summary

House Bill 447, enacted as Session Law 2023-116 in North Carolina, aims to enhance dealer independence and improve the availability of electric vehicles, particularly for rural consumers. This legislation clarifies the rights of motor vehicle dealers in relation to manufacturers, stipulating regulations around vehicle reservations made by customers directly with manufacturers. It mandates that any retail vehicle reservation must be assigned to a franchised dealer authorized to sell that vehicle model. This is expected to ensure that consumers can engage local dealers rather than only dealing directly with manufacturers, benefiting local economies and promoting personal service in vehicle purchases.

Sentiment

The sentiment around HB 447 appears largely positive among local dealers and consumer advocates who view it as a necessary measure to protect dealer autonomy and enhance consumer access to vehicle choices. Supporters argue that the bill will strengthen local economies by ensuring that consumers continue to engage with their local dealerships. However, there are concerns expressed by some manufacturers regarding additional restrictions and potential impacts on their operational flexibility, particularly in light of the growing trend towards online sales and direct-to-consumer models.

Contention

There are notable points of contention regarding the bill, particularly concerning the balance of power between manufacturers and dealerships. Critics from the manufacturing side view the bill as potentially limiting their marketing strategies and requiring adjustments to established business practices that utilize digital platforms for sales. The bill's emphasis on equitable access for dealers to vehicle stocks and the mandatory assignment of reservations aims to prevent inequities but raises questions about how manufacturers will adapt their distribution models in a rapidly evolving automotive market.