HF740 Summary

• Manufacturers must compensate dealers for warranty parts at actual cost plus reasonable markup (determined by dealer's retail rate) and reasonable labor rates based on dealer's effective non-warranty rates, with disputes resolved through internal procedures or civil action.

• Manufacturers must compensate dealers at prorated rate of at least 1.25 percent vehicle value per month for used vehicles subject to stop-sale or do-not-drive recall orders when repair parts remain unavailable for 30+ days.

• Succession agreements allowing dealers to designate successor operators upon death or incapacity are permitted; manufacturers cannot deny successors meeting good moral character and reasonable capital/experience standards.

• Manufacturers are prohibited from unfair practices including arbitrary area-of-sales-effectiveness changes (requiring 90 days' notice), unreasonable facility improvement requirements, non-uniform performance standards, and discriminatory warranty treatment; manufacturers must disclose rebate calculation methods to requesting dealers.

• Violations subject to civil penalties of up to $2,000 per violation; failure to comply with court judgments subject to penalties up to $25,000; prior warranty statute (80E.04) repealed and replaced with detailed new provisions.