SB160 revises Colorado’s motor vehicle franchise laws to address when a manufacturer’s affiliated companies are treated the same as the manufacturer itself. The bill expands the definition of “manufacturer” to include an “affiliate” that is under common control with, or can control, a specified entity and that manufactures, distributes, sells, or offers new motor vehicles for retail sale or lease. It also clarifies that existing prohibitions on manufacturers owning, operating, controlling, or competing against dealers apply not only to traditional motor vehicle dealers and used vehicle dealers, but also to dealer-operated service centers, and it adds language covering retail sale, lease, retail service, and warranty service activities.
The bill creates and modifies several exceptions to those prohibitions. A manufacturer may own, operate, or control dealers if it manufactures any vehicle and has never had franchised dealers of any line-make in Colorado, replacing the narrower current-law exception for manufacturers that make only electric vehicles and have no franchised dealers of the same line-make. The bill also expressly allows manufacturers to service their own vehicles before delivery to dealers, to provide remote software updates or repairs at no cost to consumers, and to authorize fleet owners or third parties such as government entities or rental or commercial fleets to perform warranty work under specified conditions involving a dealer of the same line-make.
The bill’s impact is to broaden the reach of Colorado’s dealer-franchise protections while also carving out clearer exceptions for certain manufacturer activities, especially in the electric vehicle, software, and fleet-service contexts. It would affect motor vehicle manufacturers, affiliated entities, franchised dealers, used vehicle dealers, dealer-operated service centers, and powersports vehicle manufacturers and dealers. The bill also makes parallel changes in the powersports statutes, extending similar limits and exceptions to powersports vehicle manufacturers and dealers.
The general sentiment reflected in the vote history is supportive but not unanimous. The Senate committee advanced the bill after adopting several amendments unanimously or near-unanimously, and the full Senate passed third reading 22-12, indicating meaningful support with notable opposition. The House committee also adopted an amendment unanimously, suggesting continued interest in refining the bill rather than rejecting it outright.
The main point of contention appears to be the balance between protecting independent dealers and allowing manufacturer-affiliate business models, especially where manufacturers seek to sell directly, operate service centers, or use affiliated entities. Supporters likely view the bill as closing loopholes and preserving franchise protections, while opponents appear concerned that the bill could further restrict manufacturer flexibility or affect emerging direct-sales and service models, particularly for electric vehicles and software-enabled vehicles.
SB160 would amend Colorado Revised Statutes sections governing motor vehicle and powersports vehicle dealer independence, expanding the statutory definition of manufacturer to include certain affiliates and prohibiting manufacturers from competing against dealers and dealer-operated service centers in retail sale, lease, service, and warranty service. It would also revise exceptions to the no-ownership/no-control rule, including a broader exception for manufacturers that have never had franchised dealers in Colorado, and add express exceptions for pre-delivery repairs, remote software updates, and certain fleet warranty service arrangements. These changes would directly affect manufacturer-dealer relationships and the scope of permissible direct manufacturer activity in Colorado.
The bill appears to have received generally favorable treatment in committee, with unanimous votes on multiple amendments and committee referrals, but the floor vote in the Senate shows a divided chamber. The 22-12 third-reading vote suggests the measure had enough support to advance, yet faced substantial skepticism. Overall, the discussion history indicates a bill that was workable enough to move forward, but still controversial because it touches a long-running policy dispute over dealer franchise protections versus manufacturer direct-sales and service models.
The central contention is whether manufacturers and their affiliates should be allowed to sell, service, or control retail channels that compete with independent franchised dealers. Dealers and dealer advocates are likely to support the bill’s anti-circumvention provisions, especially the affiliate definition and the extension to dealer-operated service centers, because those provisions close perceived loopholes. Manufacturers and direct-sales proponents are likely to object to the broader definition of manufacturer and the expanded competition ban, arguing that it could limit innovation, software support, fleet service arrangements, and business models used by electric-vehicle and other manufacturers. The revised exception for manufacturers that have never had franchised dealers in Colorado also suggests a compromise point, but one that may still be disputed by parties concerned about unequal treatment across manufacturers.