KFB: Genesis Press Release
The Florida Department of Highway Safety and Motor Vehicles has denied the distributor license application submitted by Genesis Motor America, LLC.
The Genesis brand has been and continues to be sold and distributed through Hyundai Motor America. However, Hyundai decided to pull Genesis branded vehicles out of the Hyundai line-up and distribute them through a different dealership network in the luxury car sector under the Genesis name. Aside from shifting sales of the G90 and G80s to their new Genesis dealer network, they were also set to launch a new model, the G70, through this new network.
The new Genesis dealership network and the new G70 was set to launch across America, but the recent denial of a distributor license in the state of Florida will put a kink in these plans.
The state denied the distributorship application based on a determination that the shifting of the Genesis models currently sold under the Hyundai franchise agreement to the Genesis franchise agreement would be a violation of Section 320.6415, Fla. Stat., unless Genesis offered Hyundai dealers a franchise agreement “containing substantially the same provisions which were contained in the previous [Hyundai] franchise agreement”.
The state determined that Genesis’ proposed franchise agreement did not contain substantially the same provisions as Hyundai’s franchise agreement. Additionally, the state further found that Genesis’s franchise agreement provision requiring Genesis dealers to “purchase a minimum of 50% of dealers assigned off-lease Genesis return vehicle as an upstream purchase” was a violation of Section 320.64(34), Fla. Stat., which prohibits a distributor or manufacturer from requiring dealers to purchase or sell “any quantity of used motor vehicles.” As a result, at least for the time being, Genesis Motor America, LLC is not permitted to distribute cars in the state of Florida.
The Florida Automobile Dealers Association and their counsel, Kurkin Forehand Brandes, worked closely with the state to make sure that Hyundai and Genesis complied with Florida law.