Vermont — Dealer Legislation Update

H.58, which was filed last year, would make several changes to the statute governing the relationship between equipment dealers and their supplier. In addition to the bill which was filed, the Northeast Equipment Dealers Association has several additional amendments they are offering for consideration.

The bill, which received a hearing on January 15, would prohibit termination of a dealer if his only offense was the failure to sell your equipment. “Failure to meet market share provision solely does not establish ‘cause’ for termination.” At the same time, dealers are suggesting that any changes to a dealer’s “assigned area of responsibility” be prohibited without dealer’s written consent.

Warranty labor rate that was 80% of shop rate would go to 100%. Warranty parts could be billed full retail or the highest value published in the manufacturer’s suggested price list during the last 12 months, plus freight. While the bill would force warranty repair cost to increase in Vermont, it then makes it unlawful for the manufacturer to recoup the additional expenses brought on by the bill.

The Farm Equipment Manufacturers Association has opposed this legislation and we are concerned that in testimony before the committee, the dealers association representative painted all manufacturers with a very broad brush, offering take-it-or-leave-it contracts and no ability for negotiation of terms. This testimony was clearly misleading the committee as to the relationship our members have with their dealers.

It is also the dealer associations position that with all of the changes noted above, the bill has “avoided breaking new ground”.

Again, our concern in Vermont comes from the very testimony offered by the dealer association representative. Time and time again, they justified the reason for changing the current statute not because it lacked fairness, but by picking statutes from any state where similar language had been adopted. Maine, New Hampshire, Alabama, South Carolina and even South Dakota statutes were all cherry picked as the prime example for why Vermont should follow in lock step. S