Pub. 58 2017-2018 Issue 3

17 SPRING 2018 zens. This chapter shall be liberally construed to accomplish its purposes, including the exercise of the state’s police power to ensure a sound system of distributing and selling motor vehicles through: (l) licensing and regulating manufacturers, distributors, converters, and dealers of motor vehicles; and (2) enforcing this chapter as to other persons to provide for compliance with manufacturer’s warranties and to prevent fraud, unfair practices, discrimination, impositions, or other abuses of the people of this state. (TEX. OCC. CODE ANN. § 2301.001 (Vernon 2012). As the motor vehicle impacts every person in this state thus the statute, by its own terms, is required to be construed liberally in order to accomplish the Legislature’s purpose of accountability and competition. Trucks bring produce and goods across the country. The motor vehicle carries our citizenry to work, to school, to the hospital, on vacations, and is used in everyday errands. The motor vehicle keeps our country working, moving, and prospering. The definition of what is a “motor vehicle,” amended by the Legislature over the years, is defined as: (A) a fully self-propelled vehicle having two or more wheels that has as its primary purpose the transport of a person or persons, or property, on a public highway; (B) a fully self-propelled vehicle having two or more wheels that: (i) has as its primary purpose the transport of person or persons or property; (ii) is not manufactured for use on public streets, roads, or highways; and, (iii) meets the requirements for a certificate of title; (C) an engine, transmission or rear axle, regardless of whether attached to a vehicle chassis, manufactured for installation in a vehicle that has: (i) the transport of a person or persons, or property, on a public highway as its primary purpose; and (ii) a gross vehicle weight rating of more than 16,000 pounds; or (D) a towable recreational vehicle. 3 In 1983, CSSB 1141 (SB 1141 by Brown) expanded the defi- nition of “motor vehicle” to include engines, transmissions, and rear axles with a GVW of more than 16,000 pounds. The purpose for the expanded definition, as discussed by Representative Delay in the Committee on Transportation’s Bill Analysis, May 4, 1983: Warranty protection extension. Many dealers of special- ized engines and drive trains for heavy-duty trucks are not currently included in the Motor Vehicle Commission Code. As such, dealers which provide warranty service on such component equipment often experience problems in receiving manufacturer reimbursement for services rendered. This bill will expand the definition of ‘motor vehicle’ to include these component parts, allowing these dealers warranty enforcement under this Code. Expanding the definition of “motor vehicle” to include an engine, transmission or rear axle for a heavy duty vehicle not only allows a franchised dealer to obtain necessary war- ranty reimbursement, 4 but also gives a purchaser of these components, the warranty enforcement protection under the state’s “lemon law” in lieu of a filing in federal or state district court. The expanded definition of a “motor vehicle” in conjunction with the statutory remedy, allows the small business owner as well as the fleet buyer an expeditious and economical forum for warranty enforcement as the “lemon law” provision is also added in 1983 by SB 1141. 5 As each aspect of the motor vehicle industry impacts the general economy of the state as well as localities, its effect is exemplified in the following data. 6 • The approximately 1,331 licensed Texas franchised truck and passenger vehicle dealerships are located in 284 cities and towns throughout the state. • In aggregate, these businesses represent $88.9 billion in annual sales totaling 20.6% of the entire state’s total retail sales. • These community-based and principally family-owned businesses employ approximately 100,561 full-time staff with a combined payroll upwards of $6.4 billion. • Texas franchised dealers collect and pay over $4 billion per year to the state in taxes and fees plus another $.5 billion in direct property, franchise and sales taxes that are paid to local and state entities. The Legislature, beginning in 1971, discerns the enduring impact of the heavy, medium, and light duty truck to the state’s economy and the necessity of the personal automo- bile for what it brings to constituent’s well-being and to the state’s economy. As a recognition of the essential part the automobile and dealership play in our everyday life, the State’s determined need for intra-brand competition in the sale of a motor vehicle requires overseeing and regulating the manufacturer and distributor and dealer relationship to ensure a sound economic system. INTRA-BRAND COMPETITION SURPASSES VERTICAL INTEGRATION Since enacting the 1971 statute regulating themanufacturer and distributor and dealer relationship to ensure intra-brand com- petition in the motor vehicle industry, the Legislature amends the statute seemingly each session (See Footnote 4). 7 Certain mainstays of the statute include the defining for enforcement and licensingwho is amanufacturer, a distributor, and a dealer. A“manufacturer” is a person that assembles newmotor vehicles 8 and the definition is suchlike since 1971. 9 A“distributor”means