The California New Motor Vehicle Board was created in 1967 to help resolve disputes between franchised dealers and manufacturers of new motor vehicles. The primary purpose of the Board is to offer California new car dealers a fair, fast and efficient means of resolving disputes with their respective manufacturers.
The disputes usually center on franchise terminations, add points, forced moves, and other franchise modifications. Often, a dealer’s dispute with its manufacturer leads to a full-scale trial before the Board where witnesses are called, evidence is admitted, and attorneys argue the dealerships’ case to the Board. The Board then issues a binding ruling, or judgment, regarding the dispute.
The New Motor Vehicle Board has no shortage of dealership disputes to keep it busy. In the first two months of 2017, manufacturers issued 79 notices of termination or modification to their franchised dealers in California. Based on these notices of termination or modification, the Board received 28 new protest cases, and had 53 protest cases pending before it. The 53 protests pending before the Board consisted of:
• 15 terminations of a franchise agreement
• 28 franchise modifications
• 1 establishment of a new dealer
• 1 relocation
• 5 warranty reimbursement cases
• 2 inventive program reimbursements
• 1 export or sale-for-resale case
In 2016 alone, manufacturers served nearly 200 notices of termination or modification to their franchised dealers in California. Many of these terminations and modifications resulted in hearings before the New Motor Vehicle Board. We encourage you to check back with each new issue of the Dealers Voice, where MLG Automotive Law will provide its readers with an update regarding new and notable cases pending before the New Motor Vehicle Board.