Advocates for manufacturers and dealers alike are scratching their heads over Florida's new proposed rules for factory-owned dealerships.
The Florida Department of Highway Safety and Motor Vehicles had drafted the guidelines to clear up fuzzy language in the Florida franchise law on when factories can own retail operations. Florida forbids factory ownership in most circumstances.
But the proposed new rules offer little guidance, particularly for manufacturers seeking joint ventures with minorities and other disadvantaged businesspeople, say industry attorneys.
State officials who drafted the proposed guidelines did not respond to phone calls seeking comment.
Loula Fuller, a lawyer representing the South Florida Auto-Truck Dealers Association, said the guidelines should set specific limits on the buy-out period and say how much the dealer should invest up front.
Ford says the rules jeopardize dealer-development stores. The guidelines 'seem to adopt the position that manufacturers cannot own or operate a dealership on a temporary basis' said David Kelleher, an attorney for Ford.
The proposed rules would let a manufacturer operate a dealership temporarily under a written agreement with a licensed dealer, but do not allow the automaker to own the store or be licensed as a dealer.
The rules also would allow manufacturers to own a dealership in a bona fide relationship with an independent dealer under a 'dealer-development arrangement.' But the rules do not define dealer-development arrangements.