SC Governor Signs Omnibus Franchise Legislation Providing Dealers Warranty Reimbursement at Retail

On Thursday, May 6, 2021, South Carolina Governor Henry McMaster signed R44, S510 which will greatly impact the new motor vehicle franchise system for South Carolina new car dealers.  The legislation, which goes into effect immediately, provides what is considered an improvement to manufacturer accountability of South Carolina’s new motor vehicle franchise laws, stating that dealers should be reasonably compensated for warranty work.

Included in R44, S510 are processes that have been established to allow a dealership to provide documentation to the manufacturer to request that they be paid no less for warranty repairs and parts than they are paid for non-warranty repairs and parts.    

The statute also establishes and defines the process for which the manufacturer must respond to the dealer’s request for retail parts and labor rates, including notification guidelines and timelines.  Additionally, the legislation establishes protections from adverse actions and manufacturer penalties for the dealers submitting requests for retail reimbursement. 

Despite this favorable legislation for South Carolina dealers, the process for receiving higher reimbursement for warranty parts and labor is quite complex.  There are many facets of the process, including timelines and required documentation for submission.  We recommend that you reach out to your trusted DHG advisors. 

For additional information about warranty reimbursement, please contact us at info@dhg.com.

ABOUT THE AUTHORS

Mitch Jenkins
Senior Associate

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