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SB 5377

Momentum Bucket Early Stage
Legal Title AN ACT Relating to protecting consumer choice by creating a fairer marketplace for auto sales;
Bill Description Concerning auto sales.
What this bill does
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This bill amends RCW 46.96.185 to add and clarify prohibitions and procedures governing manufacturers, distributors, factory branches/representatives, and related entities in their dealings with new motor vehicle dealers. It bars discriminatory pricing and unequal terms, unfair allocation or delivery methods (with a written disclosure requirement on request), interfering with a dealer’s right to charge a documentary service fee on affinity or similar program purchases, refusal to deliver vehicles/parts in reasonable quantities or time, unreasonable advertising or remodeling demands, and using dealer confidential or proprietary information to compete with a dealer. It also restrains manufacturers from competing with their dealers by owning or operating dealerships or dealer service facilities except in narrowly defined exceptions, and it restricts terminating or not renewing franchises for events that do not constitute good cause under RCW 46.96.060. Additional provisions (subsections (1)(k)–(r)) further prohibit coercing dealers to avoid or limit other makes or lines unless supported by reasonable business considerations, require that material facility changes be reasonable and uniformly applied, prohibit most location or substantial facility change requirements before a ten-year anniversary, establish a process and 60-day deadline for manufacturer responses to proposed executive management changes, bar conditioning transfers or incentives on site control or substantial renovations (defined as over $5,000), allow dealers to purchase franchisor image elements from alternative vendors in certain circumstances, limit adverse actions based on sales performance in a dealer’s designated area of primary responsibility, require return rights for unwanted products ordered by the manufacturer, and require at least 90 days’ written notice and stated grounds before modifying a franchise agreement. Subsection (2) creates exemptions for certain sales (government resale, driver education, bona fide promotional, quantity discount, and fleet discount programs). Definitions added or clarified include “actual price,” “control,” “own/ownership,” “operate,” exclusions for certain heavy trucks and recreational vehicles, and a fleet definition. The amendment treats violations as unlawful and unfair practices under chapter 19.86 RCW and allows an aggrieved person to petition the department to handle the matter as an adjudicative proceeding under chapter 34.05 RCW. The act takes effect January 1, 2026. The text specifies procedural burdens (for example, manufacturers bear proof burdens in certain exceptions and temporary manufacturer operation is limited to two years with a possible one-year extension by adjudicative proceeding) and numeric limits on certain ownership exceptions (for example, a four percent cap rounded up for one exception and other conditions for single-line and truck manufacturer exceptions). The provided text is incomplete: it cuts off mid-sentence at subsection (j)(ii) and earlier subsections and any additional provisions or definitions outside the extracted facts are not included, so further portions of RCW 46.96.185 that could affect interpretation are unknown.
Why it matters
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If enacted, dealers would gain stronger, concrete protections against a range of manufacturer practices that can impose unexpected costs or limit dealer options: manufacturers could not give different dealers a lower “actual price” for the same vehicle or parts, force nonuniform or unreasonable facility renovations or relocations (substantial renovations are defined as over $5,000 and relocation generally requires 60 days’ notice), block dealers from adding other makes without a business justification, or prevent executive management changes without timely written reasons. Dealers would also have rights to buy image elements from alternative vendors, return unsolicited ordered items for a full refund within 90 days, demand written disclosure of allocation/scheduling methods, and seek adjudicative relief or an unfair-practices action if those rules are violated; the law takes effect January 1, 2026 and the definition of “motor vehicle” excludes large trucks and RVs, which limits who is covered. Manufacturers and their related entities will face clearer limits and new compliance costs and risks: they must treat similarly situated dealers equitably, justify facility or management demands, limit direct competition (including caps on manufacturer-operated dealerships to about 4% in some cases and strict time limits on temporary ownership), and carry the burden of proof in many disputes; failure to comply can lead to department adjudications and unfair-practice claims. Some implementation details are missing from the extracted text (the section cuts off mid-provision and “the department” is not identified), so there is uncertainty about how a few specific exceptions and procedures would be applied in practice.
Official Documents View Full Bill Text
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SB 5377 Details and Bill Topics

Details

Date Introduced 01/20/2025
Originating Chamber Senate
Biennium 2025-26
Total Campaign Dollars Backing Bill $1,297,102.88

Bill Topics

MOTOR VEHICLES

SB 5377 Sponsors and Committee Hearings

Sponsors

Senator Saldaña (Primary)
Senator Chapman
Senator Stanford

Committee Hearings

Hearing Senate Labor & Commerce (Public)
Go to SB 5377 at leg.wa.gov

SB 5377 Bill Timeline

Early Stage
1/11/2026
SLabor & Comm
By resolution, reintroduced and retained in present status.
1/19/2025
SLabor & Comm
First reading, referred to Labor & Commerce.

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