LANSING – The Michigan House of Representative today passed a plan introduced by State Representative Roy Schmidt (D-Grand Rapids) to strengthen Michigan's auto franchise law in order to better protect auto dealers when an automaker goes into bankruptcy. The plan passed with broad bipartisan support.
"This has been a great demonstration of how we can really get things done when we all work together," Schmidt said. "This was a true bipartisan and bicameral effort in every way. Politicians and business people put aside their differences and hammered out a workable agreement that will go a long way toward strengthening our great Michigan auto industry."
Under Schmidt's plan, the Michigan Auto Franchise Law would be updated to include additional restrictions on contracts between auto manufacturers and dealers. The changes would help ensure that existing car dealers retain their market area and receive appropriate compensation if their contract is broken.
Schmidt's plan is in response to the numerous auto dealerships that lost their franchise rights during the bankruptcy restructurings of General Motors and Chrysler.
Schmidt brought members of the Michigan Automobile Dealers Association, the Auto Alliance and other interested parties to the table to work out a compromise agreement that works for all parties involved.