Management

FRANCHISE LAW ROUNDUP: Relocation

Posted By: Holly Wagner
Post Date: 12/19/2016

Please refer to Governing Statutes for more information. “Not specified” indicates that an issue is not addressed specifically in the particular statutes. Please send any updates to editors@dealernews.com

ALABAMA – Not specified

ALASKA – A manufacturer may not require, coerce, or attempt to coerce a new motor vehicle dealer to change the location of the new motor vehicle dealership or to make any substantial alterations to the new motor vehicle dealership premises or facilities if the change or alteration would be unreasonable or if there is not a sufficient supply of new motor vehicles to justify the expansion in light of the current market and economic conditions.

ARIZONA – Not allowed as a condition of business.

ARKANSAS – Reasonable and justifiable in light of the current and reasonably foreseeable projections of economic conditions, financial expectations and the motor vehicle dealer’s market. In a denial of franchise relocation, the burden of proof is on the manufacturer or distributor to show it has good cause for granting the new franchise, except when an existing franchisee initiated the relocation.

CALIFORNIA – Not specified

COLORADO – Manufacturer may not “condition the sale, transfer, relocation, or renewal of a franchise agreement or to condition sales, services, parts, or finance incentives upon site control or an agreement to renovate or make improvements to a facility; except that voluntary acceptance of such conditions by the dealer shall not constitute a violation.”

CONNECTICUT – Not specified

DELAWARE – Not specified

FLORIDA – Not specified

GEORGIA – Not specified

HAWAII – Not specified

IDAHO – Not specified

ILLINOIS – Manufacturer may not “require a motorcycle dealer to relocate to a new or alternate facility.”

INDIANA – Manufacturer may not force a relocation.

IOWA – Not specified

KANSAS – Not specified

KENTUCKY – Manufacturer may not “change the location of the dealership, or make any substantial alteration to the premises during the course of the agreement, if it would be unreasonable in light of the current economic, political and social considerations.”

LOUISIANA – Not specified

MAINE – Manufacturer may not “require any new personal sports mobile dealer to change the location of the new personal sports mobile dealership or during the course of the agreement or franchise to make any substantial alterations to the dealership premises when to do so would be unreasonable.”

MARYLAND – Not specified

MASSACHUSETTS – Not specified

MICHIGAN – Manufacturer may not “change the location of the new motor vehicle dealership or make any substantial alterations to the dealership premises, if changing the location or making the alterations is unreasonable.”

MINNESOTA – Manufacturer may not “change the location of the new motor vehicle dealership or make any substantial alterations to the dealership premises during the course of the agreement, when to do so would be unreasonable or if the manufacturer fails to provide the dealer 180 days’ prior written notice of a required change in location or substantial premises alteration”

MISSISSIPPI – Not specified

MISSOURI – Not specified

MONTANA – Manufacturer may not terminate a franchise agreement for a refusal to move.

NEBRASKA – OEM may not “change the location of the new motor vehicle dealership or make any substantial alterations to the dealership premises if such changes or alterations would be unreasonable, including unreasonably requiring a franchisee to establish, maintain, or continue exclusive sales facilities, sales display space, personnel, service, parts, or administrative facilities for a line-make, unless such exclusivity is reasonable and otherwise justified by reasonable business considerations.”

NEVADA – Not specified

NEW HAMPSHIRE – Manufacturer may not change the location of a dealership.

NEW JERSEY – Not specified

NEW MEXICO – Manufacturer may not “force a dealer to sell or relocate a franchise with another manufacturer located at the same physical location or consider the existence of another line-make at a dealership for product allocation, successorship, location approval and capitalization”

NEW YORK – OEM may not “condition the renewal or extension of a franchise on a franchised motor vehicle dealer’s substantial renovation of the dealer’s place of business or on the construction,  purchase, acquisition or rental of a new place of business by the franchised motor vehicle dealer unless the franchisor has advised the franchised motor vehicle dealer in writing of its intent to impose such a condition within a reasonable time prior to the effective date of the proposed date  of renewal or extension [but in no case less than 180 days] and provided the franchisor demonstrates the need for such change in the place of business and the reasonableness of such demand in view of the need to service the public and the economic conditions existing in the automobile industry at the time such action would be required of the franchised motor vehicle dealer.”

NORTH CAROLINA – Manufacturer may not “require, coerce, or attempt to coerce any new motor vehicle dealer in this State to change location of the dealership, or to make any substantial alterations to the dealership premises or facilities, when to do so would be unreasonable, or without written assurance of a sufficient supply of new motor vehicles so as to justify such an expansion, in light of the current market and economic conditions.”

NORTH DAKOTA – Not specified

OHIO – Not specified

OKLAHOMA – Not specified

OREGON – Not specified

PENNSYLVANIA – Expand, construct or significantly modify facilities without assurances that the manufacturer or distributor will provide a reasonable supply of new vehicles within a reasonable time so as to justify such an expansion in light of the market and economic conditions. (8.1) Unreasonably expand, construct or significantly modify facilities in light of the market and economic conditions or require a separate facility for the sale or service of a line-make of a new vehicle if the market and economic conditions do not clearly justify the separate facility.

RHODE ISLAND – A manufacturer may not reduce the price of a motor vehicle charged to a dealer or provide different financing terms to a dealer in exchange for the dealer’s agreement to: (i) Maintain an exclusive sales or service facility; (ii) Build or alter a sales or service facility.

SOUTH CAROLINA – Not specified

SOUTH DAKOTA – Not specified

TENNESSEE – Not specified

TEXAS – See Sec. 2301.467

UTAH – Manufacturer may not “require a franchisee to change the location of the principal place of business of the franchisee’s dealership or make any substantial alterations to the dealership premises, if the change or alterations would be unreasonable”

VERMONT – Manufacturer may not “change the location of the dealership or to make any substantial alterations to the dealership premises or facilities when to do so would be unreasonable” or “change the location of the dealership or to make any substantial alterations to the dealership premises or facilities in the absence of written assurance from the manufacturer or distributor of a sufficient supply of new motor vehicles to justify the change in location or the alterations.”

VIRGINIA – Not specified

WASHINGTON – Manufacturer may not “condition a renewal or extension of the franchise on the dealer’s substantial renovation of the existing place of business or on the construction, purchase, acquisition, or re-lease of a new place of business unless written notice is first provided [180] days before the date of renewal or extension and the manufacturer demonstrates the reasonableness of the requested actions. The manufacturer shall agree to supply the dealer with an adequate quantity of motorsports vehicles, parts and accessories to meet the sales level necessary to support the overhead resulting from substantial construction, acquisition, or lease of a new place of business.”

WEST VIRGINIA – Manufacturer may not “change the location of the new motor vehicle dealership or make any substantial alterations to the dealership premises, where to do so would be unreasonable. The burden is on the manufacturer or distributor to prove reasonableness by a preponderance of the evidence”

WISCONSIN – Not specified

WYOMING – Not specified

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