Online vehicle sales cheat everyone

Mike Vaughan
Publish Date: 
May 23, 2013
By Mike Vaughan

A COUPLE OF MONTHS AGO I received an email from a dealer on the West Coast complaining about the continued lack of federal and state enforcement of laws governing online sales of motorcycles and ATVs to consumers.

He pointed out that these vehicles, primarily from China, are sold without the benefit of dealers, insurance, bonds, mechanics or parts backup.

The dealer (who wishes not to be identified) illustrated the possible outcome of such a sale: A crate containing a motorcycle or scooter is dropped off at the buyer’s house. After wrestling the heavy crate into the garage, the buyer then has to figure out how to un-crate the vehicle and assemble it. Once he manages that, he takes it out for a trial run with no registration or insurance. The consumer, with probably little knowledge or experience, has probably not double-checked the wheels, axles, brakes or steering assembly to assure they’ve been assembled correctly. Because of this lack of expertise, the maiden voyage, at speeds up to 50 mph, becomes a disaster as a wheel falls off or the brakes fail, and the consumer ends up in the ICU of his local hospital.

None of this would have happened, he pointed out, if the product had been sold and prepped by a legitimate, local dealer.

...the failure of regulatory organizations like the EPA, California Air Resources Board, state DMVs and the Consumer Product Safety Commission to prevent these kinds of illegal transactions not only impacts our industry but can and will become a happy hunting ground for personal liability lawyers...

He suggested that the decline in motorcycle sales was not only a result of the recent economic sinkhole but was aided and abetted by the rise in web sales by unscrupulous offshore sales organizations. He cited 15 ways in which dealers and the public are negatively impacted by these sales, including the loss of tax revenue, registration fees and benefits to the local community that a brick-and-mortar dealership brings in terms of jobs, rents and local shop purchases.

He pointed out that the failure of regulatory organizations like the EPA, California Air Resources Board, state DMVs and the Consumer Product Safety Commission to prevent these kinds of illegal transactions not only impacts our industry but can and will become a happy hunting ground for personal liability lawyers looking to make a buck off the misfortune of someone who is maimed or killed while operating one of these vehicles.

Considering the absence of a local dealer, it’s unlikely that neither the manufacturer nor the distributor of these products will be identified and located. Even if they are, they likely will be thousands of miles away and beyond the reach of the U.S. legal system. Who, then, becomes the target of the lawsuit? Why, the regulatory agencies, of course. And who pays their legal fees? Taxpayers!

This dealer evidently has been proactive in bringing the online sales problem to the attention of the DMV. He said an officer from that organization recently stopped by his dealership to pick up all of his complaints. According to the officer, our dealer said, the DMV agrees that these online companies should be shut down, but that’s a job for the federal government, not state.

DOING IT THE RIGHT WAY
While there are a lot of Chinese motorcycles sold online, it’s encouraging to know that there are successful brick-and-mortar dealerships. One in Sacramento, Calif., the ATV Wholesale Outlet, sells Chinese motorcycles exclusively. Its owner, Doug Stabler, says the “11,000 sq. ft. facility is modeled after a Japanese franchise” but with an open showroom and parts area. The store sells SSR Motorsports, Tao Tao, Coolster and Puma brands. (Continued)