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 – Must be reasonable.
ALASKA – Not specified
ARIZONA – … “reasonable and justifiable in light of current and reasonably foreseeable economic conditions…or unless the alteration is reasonably required to effectively display and service a vehicle based on the technology of the vehicle.”
ARKANSAS – Incentive penalties allowed for refusing renovation after seven years.
CALIFORNIA – Manufacturer may not “require, by contract or otherwise, a dealer to make a material alteration, expansion, or addition to any dealership facility, unless the required alteration, expansion, or addition is reasonable in light of all existing circumstances, including economic conditions and advancements in vehicular technology.”
COLORADO – OEM may not “require, coerce, or attempt to coerce a powersports dealer to substantially alter a facility or premises if the facility or premises has been altered within the last 10 years at a cost of more than $25,000, and the alteration was required and approved by the manufacturer, distributor, or manufacturer representative; except that this paragraph (w) does not apply to improvements made to comply with health or safety laws or to accommodate the technology requirements necessary to sell or service a line-make” or technological improvements to support electric or other new technologies.
CONNECTICUT – Reasonable and justifiable in light of current and reasonably foreseeable projections of economic conditions, financial expectations, availability of additional vehicle allocation and such dealer’s market for the sale of vehicles.
DELAWARE – Manufacturer may not “require, coerce or attempt to coerce a dealer to substantially alter a facility or premises if the facility or premises has been altered within the last [seven] years at a cost of more than $250,000 and the alteration was required and approved by the manufacturer, except for improvements made to comply with health or safety laws, to accommodate the technology requirements necessary to sell or to service a motor vehicle or for alterations made pursuant to voluntary agreements between a dealer and a manufacturer where separate and valuable consideration has been offered and accepted.”
FLORIDA – If an applicant or licensee establishes a program, standard, or policy or in any manner offers a bonus, incentive, rebate, or other benefit to a motor vehicle dealer which is based, in whole or in part, on the construction of new sales or service facilities or the remodeling, improvement, renovation, expansion, replacement, or other alteration of the motor vehicle dealer’s existing sales or service facilities, including installation of signs or other image elements, a motor vehicle dealer who completes such construction, alteration, or installation in reliance upon such program, standard, policy, bonus, incentive, rebate, or other benefit is deemed to be in full compliance with the applicant’s or licensee’s requirements related to the new, remodeled, improved, renovated, expanded, replaced, or altered facilities, signs, and image elements for 10 years after such completion.
GEORGIA – Not specified
HAWAII – Manufacturer may not “require a dealer to construct, renovate, or make substantial alterations to the dealer’s facilities unless the manufacturer or distributor can demonstrate that such construction, renovation, or alteration requirements are reasonable and justifiable based on reasonable business consideration, including current and reasonably foreseeable projections of economic conditions existing in the automotive industry at the time such action would be required of the dealer”
IDAHO – Manufacturer may not require dealer to “expand facilities without a written guarantee of a sufficient supply of new vehicles so as to justify an expansion, in light of the market and economic conditions; or make significant modifications to an existing dealership or to construct a new vehicle dealership facility without providing a written guarantee of a sufficient supply of new vehicles so as to justify modification or construction, in light of the market and economic conditions.”
ILLINOIS – Not specified
INDIANA – Manufacturer may not force renovations if facilities are adequate.
IOWA – Not specified
KANSAS – Manufacturer may not require dealers to “remodel, renovate or recondition the dealer’s existing facilities as a prerequisite to receiving a model or series of vehicles” and may not require separate facilities for another brand.
KENTUCKY – Not specified
LOUISIANA – Not specified
MAINE – Not specified
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 require “a dealer to pay an extra fee, or remodel, renovate, or recondition the dealer’s existing facilities, or purchase unreasonable advertising displays, training, tools, or other materials, or to require the dealer to establish exclusive facilities or dedicated personnel as a prerequisite to receiving a model or a series of vehicles”
MISSISSIPPI – Not specified
MISSOURI – Not specified
MONTANA – Manufacturer may not require “a motorsports dealer to remodel or renovate existing facilities as a prerequisite to receiving a model or series of motorsports vehicles”
NEBRASKA – Manufacturer 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 – A manufacturer shall not require a dealer: (a) to alter substantially an existing facility of the dealer; or (b) to construct a new facility, for any new vehicles that are handled by the dealer unless the alteration or new construction constitutes a reasonable facility requirement in accordance with the franchise agreement.
NEW HAMPSHIRE – Manufacturer or distributor shall have the burden of proving that changes, alterations, remodeling, or replacement to a motor vehicle dealer’s sales or service facilities or signage are reasonable and justifiable. Timeframe specified at 15 years unless the manufacturer or distributor is paying 65 percent or more of the cost.
NEW JERSEY – Not specified
NEW MEXICO – Every 10 years
NEW YORK – Not specified
NORTH CAROLINA – Manufacturer may not “require, coerce, or attempt to coerce any new motor vehicle dealer … 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.” “Nothing contained in this subdivision shall prohibit a manufacturer from providing assistance or encouragement to a franchised dealer to remodel, renovate, recondition, or relocate the dealer’s existing facilities, provided that [NC General Statutes Chapter 20 Article 12-41] this assistance, encouragement, or rewards are not determined on a per vehicle basis.”
NORTH DAKOTA – Not specified
OHIO – Manufacturer may not require, coerce, or attempt to coerce any new motor vehicle dealer in this state to change the location of the dealership, or to make any substantial alterations to the dealership premises or facilities, if any of the following apply: (i) The proposed change or alteration would be unreasonable in light of the current market and economic conditions; (ii) The change or alteration is proposed without a written estimation of a sufficient supply of new motor vehicles so as to justify the location change or alterations in light of the current market and economic conditions; (iii) The change or alteration is proposed within seven years after the dealership premises was constructed or altered, as approved by the franchisor unless the change or alteration is necessary to comply with a health or safety law, or a technology requirement that is essential to the sale or service of a motor vehicle that the new motor vehicle dealer is authorized by the franchisor to sell or service.
OKLAHOMA – Not specified
OREGON – Permitted every seven years, more frequently under some circumstances. Except as provided in paragraph (b) of this subsection, a manufacturer, distributor or importer may not require a dealer to construct a new dealer facility or materially alter or remodel an existing dealer facility within seven years after the date on which the dealer previously constructed, materially altered or remodeled the existing dealer facility if the existing dealer facility complies with the manufacturer’s, distributor’s or importer’s approved brand image standards or plans that existed at the time the dealer constructed, materially altered or remodeled the existing dealer facility.
PENNSYLVANIA – Not required to 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) Dealers cannot be forced to 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 – Manufacturer may not “require that a dealer expand facilities without a guarantee of a sufficient supply of new motor vehicles to justify that expansion or to require that a dealer expand facilities to a greater degree than is necessary to sell and service the number of vehicles that the dealer sold and serviced in the most recent calendar year.”
SOUTH CAROLINA – Not specified
SOUTH DAKOTA – Not specified
TENNESSEE – Not specified
TEXAS – Manufacturer may not require in less than 10 years, or to sell or service a particular line.
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 “coerce or require any dealer, whether by agreement, program, incentive provision or otherwise, to construct improvements to its facilities or to install new signs or other franchisor image elements that replace or substantially alter those improvements, signs or franchisor image elements completed within the proceeding 10 years that were required and approved by the manufacturer, factory branch, distributor or distributor branch or one of its affiliates.” In termination actions, OEM must pay for required alterations within the past five years.
WISCONSIN – Not specified
WYOMING – Manufacturer may not require dealers “to expand facilities without making available a sufficient supply of new vehicles to justify an expansion considering the market and economic conditions;” to modify significantly an existing dealership or to construct a new vehicle dealership facility without a sufficient supply of new vehicles to justify a modification or construction considering the market and economic conditions.