Good morning.

Thank you for bringing to our attention to the recent phone call you received from Mazda. This is just one of a series of phone calls being made by several manufacturers who are inventing false excuses to raise dealer concerns about the language of the proposed new legislation supported by the Association.

Apparently you were told that the bill's new language could threaten the exclusivity benefits being given to exclusive Mazda dealers. Before we explain why the claim is nonsense, we would observe that in fact the program is already questionable under present law. Virginia law prohibits exclusivity requirements. Virginia law also prohibits a manufacturer from requiring a dealer to waive a right or benefit to obtain a benefit. In this case, there is a right to be nonexclusive. Requiring a waiver of that to obtain an incentive payment per vehicle probably already violates existing law. If a dual dealer challenges the program, that could very well lead to the kind of concern that Mazda is raising. That has been the case since the General Assembly amended the anti-waiver statute two years ago. That has not stopped Mazda from offering this program in VA.

The pending bill does not affect Mazda's program in any way. The pending bill is very simple: If a dealer has done facility improvements within the last 10 years, and a new program from a manufacturer requires that those same improvements be replaced, the dealer is not required to do that. The dealer is deemed to be in compliance with the facility provision of the program. We were very careful in creating the bill's terms. It does not apply to any other portion of an incentive program. It does not affect sales requirements, vehicle purchase requirements, parts purchase requirements, customer satisfaction requirements, exclusivity, or any other performance provision a manufacturer can dream up to micromanage a dealer's business that is something other than facility upgrades to replace those done within 10 years. Consequently, while Mazda's program is already questionable and that has not stopped Mazda from offering it, the proposed legislation that does nothing to affect the program in any way should have no impact on Mazda's decision making.

Mazda is quite aware that this bill will not affect their existing program. At the request of the Manufacturers, we added language to make clear that this only applies to Programs offered after the effective date of the legislation. 

Below is a link to some information we distributed to dealers Wednesday to clear up the confusion about this provision of the legislation. Please let us know if we can provide more information to you.

CLICK HERE to open a printable copy of this info