Pub. 1 2019-2020 Issue 4

11 software companies. This bill simply grants you the ability to choose your own digital vendor while also ensuring vendors meet manufacturer standards. Brand Spin-offs Requirements Several manufacturers have recently decided to take an existing line of vehicles from one franchise and spin those vehicles off into another brand. A manufacturer has in- formed its dealers that they will be required to repair a new line of vehicles sold by the manufacturer’s affiliate, but the dealers won’t be able to sell or lease these vehicles. AB 179 prevents a manufacturer from requiring you to repair vehicles that you cannot sell. Meanwhile, other manufactur- ers are establishing a new line of vehicles under the fran- chise’s name but limiting which dealers can have access to these new vehicles. This bill clarifies that manufacturers cannot refuse or fail to deliver in reasonable quantities and within a reasonable amount of time a new vehicle to you. This important change will ensure that you can continue to have access to new zero-emission vehicles, thereby help- ing our state reach its greenhouse gas reduction goals. Protests at the New Motor Vehicle Board The New Motor Vehicle Board is a quasi-judicial body set up specifically to hear franchise disputes between new motor vehicle dealers and manufacturers. AB 179 does two significant things at the New Motor Vehicle Board (Board). First, the bill reestablishes for an additional ten years the ability for a dealer association to bring a protest on a manufacturer’s export prohibition policy to the Board, which expired on January 1, 2019. You might recall that CNCDA successfully used this authority in a protest against Jaguar-Land Rover of North America, where the Board found that the export prohibition policy on its face violated California law. Second, manufacturers measure dealer performance under a franchise agreement or incentive program based on standards established solely by the manufacturer that must be reasonable in light of all existing circumstances. AB 179 also allows the Board to hear protests by a dealer relating to a manufacturer’s performance standards, thereby expanding your rights at the Board to push back on unreasonable requirements by your manufacturer. Other Franchise Protections AB 179 also provides additional protections for dealers regarding indemnification and customer service bulletins and campaigns. Specifically, this bill strengthens indemni- fication by prohibiting automakers from requiring a dealer to indemnify the manufacturer or affiliate for any program or requirement imposed on the dealer. Finally, this bill also prevents manufacturers from restricting or discour- aging dealers from checking about vehicle eligibility for customer service bulletins and campaigns. If you have any questions regarding the franchise bill and CNCDA’s efforts, please feel free to contact me at ccosta@cncda.org or 916-441-2599. I hope you see you at this year’s New Laws Seminars. 3 CONCERNED WITH THE COST, COMPLIANCE AND SERVICING OF YOUR DEALERSHIPS’ INSURANCE? EPIC CAN HELP WITH YOUR BENEFIT AND BUSINESS INSURANCE NEEDS • CNCDA's only licensed broker for Health and Business insurance • The largest insurer of auto dealers in the state • The only broker with proprietary products specific to dealerships • 15TH largest brokerage firm in the nation We know dealerships have specific needs and issues, we are here to help. Please contact us for a free evaluation of your insurance and HR/compliance packages. © EDGEWOOD PARTNERS INSURANCE CENTER | CA LICENSE 0B29370 EPICBROKERS.COM Alison McCallum 949.417.9136 alison.mccallum@epicbrokers.com Eric Shaw 916.832.0958 eric.shaw@epicbrokers.com