SB 197 Summary

• Establishes comprehensive protections for new motor vehicle dealers by requiring manufacturers to demonstrate "good cause" for terminating franchise agreements, with manufacturer bearing burden of proof and dealers having right to court action within 30 days.

• Requires manufacturers to provide 90-day termination notice (15 days for insolvency, criminal conviction, or license revocation; 180 days for product line discontinuation) and prohibits termination based solely on sales performance without meeting specific standards including 180-day improvement period.

• Mandates compensation to dealers upon termination including repurchase of unsold inventory at dealer cost, equipment and parts, facility relocation costs, and rental value of facilities for up to 24 months.

• Prohibits 23 specific unfair practices by manufacturers including discriminatory pricing, preventing multi-brand dealerships, mandatory facility improvements, coercion regarding advertising, and prohibition on dealer changing executive management without manufacturer burden of proof.

• Establishes warranty compensation requirements including parts at retail rates plus average markup, labor at retail rates, and requires manufacturers to approve or deny warranty claims within 15 days or claims are deemed approved; limits audits to six-month window and one per year.