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State Senate Wades Into Fight Between Auto Dealers and Manufacturers

After pumping the brakes a few times, a Senate committee approved a bill Tuesday siding with car dealerships in a long running fight with auto makers over whether old contracts trump new changes to the law.

The fight that was revved up by a recent decision by the Department of Highway Safety and Motor Vehicles, which ruled that franchising contracts dealers had with car makers superseded amendments to the Florida Automobile Dealers Act.

The bill (SB 2410) crafted in response to that decision was approved by the Senate Transportation Committee Wednesday after the panel had postponed voting on the measure three times to try to find a compromise. It is a priority of the dealers, who argued that the field needed to be leveled because the DHSMV decision created different protections for dealers based on when they agreed to become franchises for auto brands.

By contrast, manufacturers like the DHSMV decision and want to see it upheld.

To try to find the middle of the road, provisions in the bill that had been pushed for by car dealers to eliminate the ability of manufacturers to control where dealerships are placed and to require them to pay market value for dealerships they decide to close were tossed aside.

What was left Wednesday was a requirement that the DHSMV not renew licenses between dealers and manufacturers unless they comply with the current Dealer Act. But even in voting out the measure after postponing it twice in March and once earlier this month, the Transportation Committee expressed leeriness about wading into the fight.

Sen. Arthenia Joyner, D-Tampa, said the Legislature has gone down the road of mediating differences between Detroit and the dealers too often over the years.

“I really believe this is not in the best interest of either us or the other parties involved, because we aren’t giving them a chance to sit down like big boys and big girls and work it out, or grown folks as my grandma would say,” Joyner said. She was the lone “no” vote.

The bill’s sponsor, Sen. Carey Baker, R-Eustis, said the committee did not have a choice but to take sides in the battle, though he acknowledged lawmakers may be feeling “auto dealer and auto manufacturer fatigue.”

“The issues are all legitimate and we probably need to settle this with some finality if we can,” Baker said.

Transportation Committee Chairman Andy Gardiner, R-Orlando agreed, saying the measure “gets to the heart of what the role of the Legislature is and the ability…to affect an existing contract and what’s the purpose of the contract.”

“We (postponed) this bill for three weeks trying to come sort of agreement between the parties,” Gardiner said. “It is a unique situation because many of us believe strongly in the free market, but in a lot of respects, when it comes to manufacturers and the dealers, there isn’t a free market. There just isn’t. That’s why they’re here every year.”

Gardiner said he would push for the bill to be considered in the Senate Judiciary Committee “so that there can be some real discussion regarding contract law, what the role of the Legislature is and what our obligation is.” But a decision on the next stop for the bill has not been made yet, he said.

“Obviously it’s the will of the Senate President, but Judiciary, I think a lot of the issues that are being brought up, it would be a good opportunity for us to really hammer out,” he said.

The committee approved the measure 8-1.

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