SB 2697 Summary

• Manufacturers must compensate new motor vehicle dealers for all labor and parts required to perform recall repairs on used vehicles subject to federal safety or emissions recalls with stop-sale or do-not-drive orders.

• Manufacturers shall pay dealers at least 1% of the vehicle's average trade-in value per month (prorated) if recall parts or remedies remain unavailable for more than 30 days after the stop-sale order, continuing until parts become available or the vehicle is sold.

• Manufacturers are prohibited from reducing other compensation owed to dealers solely because the dealer submitted a recall compensation claim under this section.

• Manufacturers cannot require dealers to construct or substantially alter facilities if alterations costing more than $50,000 were completed within the previous 12 years with manufacturer approval, except for health, safety, or technology improvements.

• Dealers may purchase goods and services from vendors of their choice when substantially similar quality and design are available, and dealers may purchase signs and image elements from any vendor; manufacturers cannot require dealer purchases from manufacturer-designated vendors unless prior approval is reasonably withheld.