Bill > H406

This bill clarifies and strengthens motor vehicle dealer laws in North Carolina by adding several key protections and regulations for dealerships. The bill restricts manufacturers from conditioning franchise approvals on dealers constructing new facilities, acquiring or divesting vehicle lines, or establishing exclusive facilities. It also prohibits manufacturers from considering an applicant's previous legal actions or franchise denials when evaluating dealership transfer requests. The bill requires manufacturers to provide dealers with 20% compensation for over-the-air vehicle services sold within 12 months of a vehicle's purchase and mandates monthly reporting of such sales. Additionally, the legislation makes it harder for manufacturers to reject proposed changes in dealership management by placing the burden of proof on manufacturers to demonstrate a candidate's poor performance. The bill expands the definition of a motor vehicle dealer to include those performing warranty services and clarifies what constitutes "selling" a vehicle, including activities like taking deposits, setting prices, and negotiating terms. Other provisions include requiring full reimbursement for loaner vehicles, preventing manufacturers from selling unfinished vehicles, and prohibiting price variations for training based on facility compliance. The bill applies to all current and future franchises and becomes effective immediately upon becoming law.

Government Affairs, Transportation and Infrastructure

https://www.ncleg.gov/BillLookUp/2025/H406