Bill > SB1939

This bill modifies the Motor Vehicle Franchise Act to place significant restrictions on manufacturers, distributors, and their related entities in selling and servicing motor vehicles directly to consumers. The bill introduces a new definition of "common entity" to capture various corporate structures that might attempt to circumvent existing franchise laws. It prohibits manufacturers or distributors (with some limited exceptions for those already selling directly to consumers before January 1, 2022) from owning or operating dealerships or selling new vehicles directly to consumers in the state. The legislation aims to protect existing franchise dealer networks by preventing manufacturers from establishing alternative sales channels or using subsidiary companies to bypass traditional dealership arrangements. Key provisions include preventing manufacturers from directly competing with their franchisees, restricting the creation of new entities to sell vehicles outside the franchise system, and maintaining the existing framework that requires manufacturers to sell vehicles through independent dealerships. The bill also includes detailed provisions about warranty claims, compensation for dealers, and protections against arbitrary actions by manufacturers, reinforcing the existing regulatory structure that governs relationships between vehicle manufacturers and their franchised dealers.

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https://www.ilga.gov/legislation/BillStatus.asp?DocNum=1939&GAID=18&DocTypeID=SB&SessionID=114&GA=104