Virginia Dealer Board March Meeting Highlights

Virginia Dealer Board March Meeting Highlights

On Monday, March 11, 2002, the Virginia Motor Vehicle Dealer Board (MVDB) and its committees held their regular meetings. The board considered the following issues:

àThe Franchise Committee discussed the failure of Mazda of America and Volkswagen of America to submit two important documents being circulated to dealers affecting the franchise relationship to the DMV commissioner for approval as required by the Virginia Code. The commissioner has advised VWoA that the latest VW Operating Standards should be submitted, but VWoA has not responded within the allotted time. Similarly, the commissioner has advised Mazda that its Mazda Elite program must be submitted for approval, just as its corporate parent Ford submitted the Ford Blue Oval and Lincoln Premier programs. Mazda has apparently written to the commissioner and disagreed with the commissionerês views. It was the sense of the Franchise Committee that it would request the commissioner to advise Virginia dealers that these documents have not been submitted to the DMV pursuant to state law and that the manufacturers are not authorized to submit them to Virginia dealers for signature.

àThe Licensing Committee heard a report of the special committee considering use of dealer tags. A letter will soon be sent to dealers from the board indicating that independent contractors (even if they have a sales person license) may not use a dealer tag. Only employees may drive on a dealer tag, without a permission to drive form.

àThe Advertising Committee considered two radio ads that had front loaded disclosures, apparently at increased speed and lower volume. The committee agreed that the MVDB must enforce its current regulations which require that radio disclosures be clear and conspicuous.

The committee also voted to consider special promotions in which groups bringing in unlicensed salespeople run short-term sales at dealer locations or special locations, and it approved a $500 civil penalty against a franchised new vehicle dealer whose advertising failed to make the proper disclosures required by the Truth in Lending Act.

The Budget Committee was notified that the state will be taking $250,000 to $400,000 of reserves from the operating fund of the MVDB over the next three years as part of the stateês steps to handle its budget crisis.