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When an existing dealership can protest a competitor’s opening

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Florida’s automobile dealership laws provide certain protections for existing dealers and their customers. One such example is through statutes ensuring fair competition. Essentially, dealerships selling the same models from the same manufacturer can’t be pitted against each other in the same market.

When a new dealership wants to open, and an existing business believes doing so would be in violation of state law, regulations provide a way to protest. When considering such a protest, there are three key things to consider.

1. County population

Florida law treats auto dealership law a bit differently depending on the population of the county in which the business is located. The cut-off line is 300,000. A county with fewer than 300,000 residents has different standards than a county with more than that figure.

The main change is regarding proximity between the two dealerships.

2. Proximity of the dealerships

One of the ways the law tries to ensure fair competition is by prohibiting dealerships selling the same line-make from opening near each other.

For smaller counties, existing dealerships have a 20-mile border of protection. If a new dealer wants to open a franchise selling the same line-make within 20 miles, the existing franchise has an opportunity to file a protest. For larger counties, that border shrinks to 12.5 miles.

3. Local sales figures

Sales figures for new vehicle models can also come into play. If an existing dealership can demonstrate 25% of its sales in recent years have come from individuals living nearby (following the same mile requirements explained above), they may have an avenue to file a protest. There is an exception, however, if the new dealership is not located in the same county or a contiguous county where the new business is proposing to open.