Direct Sales, Overreaching Factory Programs and Spin-Off “Dealerships” Recently, IADA was involved in a pair of legal actions in which important dealer rights under the Illinois Motor Vehicle Franchise Act were being challenged. IADA supported a group of 29 Ford dealers who filed a protest in December 2022, challenging Ford’s “Model e” electric vehicle allocation program. Ford’s Model e Program would have interfered with price negotiation, trade-in valuations and vehicle allocation. The successful Board protest preserved Ford dealers’ (and all dealers’) right to continue operating as independent dealers. In November 2023, the Motor Vehicle Review Board held that the Ford Model e program violated the Act, which was a huge victory for the entire dealer body in Illinois as well as the rest of the county. The Illinois Motor Vehicle Review Board decision was a catalyst for Ford to discontinue the program nationwide. IADA was also heavily involved in litigation to challenge the direct sale of motor vehicles by certain manufacturers. In March of 2021, IADA, along with the Peoria Metro New Car Dealers Association, the Illinois Motorcycle Dealers Association, CATA and over 300 dealers sued motor vehicle manufacturers Rivian Automotive and Lucid Motors to challenge the issuance of dealer’s licenses to those manufacturers to sell directly to the public. Unfortunately, after litigating the direct sale issue all the way to the Illinois Supreme Court, the dealer challenge to direct sales was dismissed. Currently, IADA is trying to stop the spread of direct sales to additional manufacturers. IADA-promoted legislation, Senate Bill 1939, would prevent legacy manufacturers from using affiliates or spinning off new companies to sell directly to the public in competition with their dealer networks. As motor vehicle recalls continue at an astounding pace, a franchised dealer network advocating for customers is the best assurance that recalled vehicles are repaired as soon as possible. Direct sales by vertically integrated manufacturers also lead to higher vehicle and service costs for consumers. For more than a century, IADA has proudly stood as a strong advocate for Illinois dealers, and that success has only been possible because of unwavering grassroots support from you, our valued members. Thank you for being the driving force behind our efforts. We ask for your continued support of all our vital IADA partnerships with CVR and programs like Ethos, Champ Titles and others highlighted on www.illinoisdealers.com. Together, we can keep championing the interests of Illinois dealers for years to come. 20 Illinois Automobile Dealer News
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