Pub. 3 2021-2022 Issue 2

14 A s you may know, in January 2019, CNCDA filed a petition at the New Motor Vehicle Board (NMVB) against Volvo, which alleged that Care by Volvo (its vehicle “subscription” program) violated California law. Our principal concern with Care by Volvo was (and still is) that Volvo is attempting to use the program to illegally compete against its dealers. Volvo of- fers its most popular vehicles via two-year lease bundled with insurance, maintenance, and wear and tear coverage through the program. The bundle is offered at a price that substantially undercuts dealer lease offerings. To add insult to injury, dealers were coerced into acting as delivery agents for vehicles sold by Volvo through Care by Volvo. Dealers had no opportunity to apply trade-ins to the vehicle’s price and could not include optional products. Following the filing of CNCDA’s petition against Volvo, I spoke at the National Association of Dealer Counsel (NADC)’s April 2019 conference about the danger Care by Volvo represents to our industry. At the April 2019 conference, several attendees were convinced that vehicle subscription programs were a fad and that they were already fading. I argued that some manufacturers (including Volvo) were using subscription programs as a justification to compete directly with their franchisees. In the months following my presentation at the NADC conference, concerns about Care by Volvo receded from the front of my mind. They were replaced by more pressing matters, such as daily COVID compliance alerts. And in April 2020, the DMV ended its investigation into Care by Volvo (ordered by the NMVB due to our petition). The DMV concluded that Volvo was illegally competing Anthony Bento Director of Legal and Regulatory Affairs ADangerous Precedent: Volvo Appears Committed to Direct Sales