                                 CODE OF VIRGINIA

MANUFACTURER OR DISTRIBUTOR USE OF PERFORMANCE STANDARDS (§ 46.2-1572.4)

A. Any performance standard or program that is used by a manufacturer or
distributor for measuring dealership performance and may have a material effect
on a dealer, and the application of any such standard or program by a
manufacturer or distributor, shall be fair, reasonable and equitable, and if
based upon a survey, shall be based upon a statistically valid sample. Upon the
request of any dealer, a manufacturer or distributor shall disclose in writing
to the dealer a description of how a performance standard or program is designed
and all relevant information used in the application of the performance standard
or program to that dealer.

B. A manufacturer or distributor shall not use any data, calculations, or
statistical determinations of the sales performance of a dealer for any purpose,
including (i) loss of incentive payments or other benefits, (ii) claim of breach
or threats thereof, or (iii) notice of termination or threats thereof for the
period of time the manufacturer, factory branch, distributor, or distributor
branch has established an agreement, program, incentive program, or provision
for loss of incentive payments or other benefits that causes a dealer to refrain
from selling any used motor vehicle subject to (a) recall, (b) stop sale
directive, (c) technical service bulletin, or (d) other manufacturer, factory
branch, distributor, or distributor branch notification to perform work on a
dealer&#8217;s used motor vehicles in its inventory when there is no remedy or
there are no parts to remediate each such affected used motor vehicle from the
manufacturer, factory branch, distributor, or distributor branch and for 90 days
after the termination of such agreement, program, incentive program, or
provision for loss of incentive payments or other benefits.
			The data on which the manufacturer or distributor seeks to rely under this
subsection shall only be for a period or periods not excluded under this
subsection. For any performance standard or program that is used by a
manufacturer or distributor for measuring dealership performance during the
period or periods excluded under this subsection, a dealer shall be deemed in
compliance with any such program requirements related to sales performance or
sales or service customer satisfaction performance of a dealer.
			This subsection shall not prevent a manufacturer, factory branch,
distributor, or distributor branch from (1) requiring that a motor vehicle not
be subject to an open recall or stop sale directive in order to be qualified,
remain qualified, or be sold as a certified pre-owned vehicle or similar
designation; (2) paying incentives for selling used vehicles with no unremedied
recalls; (3) paying incentives for performing recall repairs on a vehicle in the
dealer&#8217;s inventory; or (4) instructing that a dealer repair used vehicles
of the line-make for which the dealer holds a franchise with an open recall,
provided that the instruction does not involve coercion that imposes a penalty
or provision of loss of benefits on the dealer.

C. A dealer may apply to the manufacturer, factory branch, distributor, or
distributor branch for adjustment to data, calculations, or statistical
determinations of sales performance or sales and service customer satisfaction
performance for any period of time that such dealer has at least five percent of
its new motor vehicle inventory subject to a recall or stop sale directive and
for 90 days after the end of such period of time. Within 30 days of application
for adjustment, the manufacturer, factory branch, distributor, or distributor
branch shall use reasonable efforts to review and adjust the data, calculations,
or other statistical determinations back to the date that the dealer was
prevented from selling the new motor vehicles. A dealer applying for adjustment
shall have the burden of showing that the prevention of sale had a material,
adverse impact on such dealer&#8217;s new vehicle sales performance or sales and
service customer satisfaction performance, and the adjustments by the
manufacturer, factory branch, distributor, or distributor branch shall use
reasonable efforts to remediate the effect of the impact shown on the data,
calculations, or statistical determinations of sales performance or sales and
service customer satisfaction performance.
			The manufacturer shall take into consideration any adjustments to a
dealer&#8217;s new vehicle sales performance or sales and service customer
satisfaction performance made by the manufacturer under this subsection in
determining a dealer&#8217;s compliance with a manufacturer performance standard
or program.

HISTORY: 2001, cc. 165, 173; 2016, cc. 432, 534.