Virginia House Bill HB1683

Virginia 2025 Regular Session

• Introduced: 1/3/25
• Refer: 1/3/25
• Report Pass: 1/30/25
• Engrossed: 2/3/25
• Refer: 2/5/25
• Report Pass: 2/13/25
• Enrolled: 3/7/25
• Chaptered: 3/24/25
• Passed: 3/24/25

Caption

Motor vehicle dealers; recall and warranty costs, right of first refusal.

Impact

The legislation impacts state laws by detailing the obligations manufacturers have towards their dealers, particularly in matters of warranty and recall services. It mandates that dealerships must be compensated fairly for their work concerning recalls and warranties. Furthermore, it sets clear guidelines for financial responsibilities when a manufacturer or distributor fails to meet their obligations, ensuring that dealers are not financially burdened by the manufacturers' shortcomings.

Summary

House Bill 1683 amends sections of the Virginia Code related to motor vehicle dealers, specifically concerning the rights of manufacturers and the obligations of dealers regarding recalls and warranties. The bill establishes the conditions under which manufacturers can exercise a right of first refusal in the sale or transfer of a dealership. This aims to protect established dealerships from being sold to parties that may not uphold industry standards or the intent of the franchise agreements.

Sentiment

The sentiment surrounding HB 1683 appears to be generally supportive among dealers who view the amendments as safeguards against unfair practices by larger manufacturers. However, there may be some concerns from manufacturers about the restrictions imposed regarding their rights in dealership sales and transfers. Overall, it seems to resonate positively in protecting local dealers' rights and ensuring fair compensation.

Contention

Key points of contention include the balance of power between manufacturers and dealers, with some stakeholders potentially viewing the bill as a limiting factor on manufacturers' flexibility in managing their dealership relationships. Manufacturers might argue that the proposed right of first refusal could hinder their ability to ensure strong brand representation by limiting their options for potential dealership ownership. Conversely, dealers strongly support the bill as a measure that enhances their rights and financial security.