March 22, 2021
AUTONOMOUS VEHICLE LEGISLATION MUST PRESERVE STATE VEHICLE FRANCHISE LAWS AND
The key to advancing the consumer adoption of both electric and autonomous vehicles is a strong partnership of vehicle manufacturers and retailers with a wide and competitive distribution network, which will help drive vehicle affordability and consumer demand. Based on the states’ interest to protect consumers, preserve price competition, support local jobs and provide local and state tax revenue, states have traditionally had the right to license and regulate the distribution, and sale and service of vehicles within their borders. The federal government has only preempted state laws that impact vehicle design, construction and safety, thereby establishing one set of motor vehicle safety standards for all 50 states. Auto dealers support this well-established and balanced framework. As Congress considers legislation that would regulate electric or autonomous vehicles, it must ensure that the states’ traditional role to license and regulate vehicle commerce, provide consumer protections, and promote vehicle price competition within its borders is preserved.
OVERBROAD RECALL BILL
WILL CREATE A CONSUMER TRADE-IN TAX
Last Congress, Sen. Richard Blumenthal (D-Conn.) introduced S. 1971, a bill that would cripple the used-vehicle market by halting a dealer’s sale, lease, wholesale or loan of used vehicles under any open recall. The bill is overbroad because most recalls do not require the drastic step of grounding. Additionally, the bill would create a “trade-in tax” that would instantly devalue a car buyer’s trade-in by grounding recalled vehicles for minor matters, such as a peeling sticker. Finally, the bill would push recalled vehicles into the unregulated private market, making it more difficult to complete recall repairs. Congress should oppose overbroad recall legislation and focus on initiatives to improve consumer response to vehicle recall notices and increase recall completion rates.
MODERNIZE THE TRUCK FLEET: REPEAL THE FET ON HEAVY-DUTY TRUCKS
Congress should revisit the 12% federal excise tax (FET) imposed on new heavy-duty trucks as it considers an infrastructure bill later this year. First enacted in 1917 to help fund World War I, this tax, which is atop nearly $40,000 in recent federal emissions and fuel-economy mandates, routinely adds $22,000 or more to the price of a new heavy-duty truck. The FET is a costly barrier to the purchase of new trucks with the latest environmental and safety technology. NADA, and its truck division the American Truck Dealers (ATD), supports repealing the FET and replacing it with another, more equitable source of revenue.
In 2019, a bill to repeal the FET (H.R. 2381) attracted bipartisan support. When heavy duty truck sales plummeted due to the pandemic, Rep. Chris Pappas (D-N.H.) and 54 other Democrats wrote the House Ways and Means Committee, encouraging the committee to consider FET suspension. This year an industry coalition, Modernize the Truck Fleet, is urging repeal of the FET and is helping identify viable funding alternatives in the next infrastructure bill. Congress should repeal the FET to spur new-truck sales, promote the deployment of cleaner, safer trucks and modernize the truck fleet.
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