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President Bush signed a bill over the weekend that prohibits mandatory binding arbitration in manufacturer-dealer agreements — a subject that almost caused a schism three years ago in the much-touted unity in the RV industry.
Backed by the National Automobile Dealers Association (NADA), the bill was aimed primarily at the relationship between auto manufacturers and their dealers.
“This is the biggest legislative victory for NADA in at least 50 years,” said NADA Chairman H. Carter Myers III. “We were persistent and we prevailed.”
The new law, which according to RVIA, applies to both motorhome and towable RV builders, passed almost without notice.
It prohibits manufacturers from requiring that mandatory binding arbitration be used to settle disputes with their dealers. If a state law requires mandatory binding arbitration, that state requirement is void.
The RV industry got swept into the controversy when the national Recreation Vehicle Dealers Association (RVDA) at first agreed to join the Recreation Vehicle Industry Association (RVIA) in seeking an RV industry exemption from the proposed law, and then later reversed itself.
The turnabout caused bad feelings among members of both organizations and RVIA did not press further for the exemption.
Additionally, over the last few years, several manufacturers, instead of pushing for new legislation, have decided to focus on structuring their dealer agreements in ways to create a competitive advantage for themselves.