Hyundai Dealers Push-Back on IONIQ Participation Agreement

BSM has been contacted by a number of Hyundai dealers across the country who are questioning the appropriateness of the IONIQ EV Participation Agreement. Like electric vehicle agreements proposed by General Motors, Volkswagen and others, the IONIQ EV Participation Agreement raises potential violations of both the Hyundai Dealer Agreement and state motor vehicle franchise laws. Under both the Hyundai Dealer Agreement and state motor vehicle franchise laws, Hyundai dealers are promised receipt of all vehicle models produced under the Hyundai brand name. Requiring dealers to execute a separate Participation Agreement in order to receive the new IONIQ electric vehicle would appear to fly in the face of these provisions. Likewise, dealers should be wary of signing the Participation Agreement as it contains a prospective commitment whereby the dealer agrees to comply with whatever facility and marketing requirements are placed on the dealer in the future as it relates to the IONIQ electric vehicle. HMA is asking dealers to agree to terms not yet known and if those terms are not complied with then the dealership is agreeing it is not entitled to receipt of IONIQ vehicles.