HB 136 Summary: Motor Vehicle Dealer Franchises

• Extends termination notice period for franchise agreements from 60 days to 120 days for correctable deficiencies, while preserving 15-day notice for fraud and systematic violations.

• Establishes manufacturer repurchase obligations upon franchise termination, including new and previous-year inventory at net acquisition cost, parts at dealer pricing, equipment at fair market value, and lease termination costs for required electronic systems.

• Adds new warranty work compensation requirements, including mandatory payment schedules based on retail markup rates, limiting manufacturer audits of paid claims to one per calendar year within one year of payment (except for suspected fraud).

• Restricts manufacturers from unreasonably refusing dealership ownership transfers and establishes 75-day approval timelines; permits right of first refusal only for non-family transfers with equal or greater compensation and reasonable expense reimbursement.

• Prohibits unfair dealer practices including unreasonable facility relocations, mandatory pre-owned vehicle inventory quotas, price increases on already-ordered vehicles with confirmed sales, and coerced participation in advertising associations.