Dealer Awarded License for Sale of Only 1 Vehicle

Article excerpt

Rex Floyd of Norman found himself at the center of a small storm of controversy Tuesday.

And, that small storm threatens to become a full-fledged tornado.

Floyd, who owns and operates recreational vehicle dealerships in the Oklahoma City metropolitan area, received a temporary license to sell Toter tow vehicles for fifth-wheel trailers.

However, that license expires when he sells the one vehicle he has in stock.

Toter tow vehicles are converted pickups manufactured by Carriage Inc. of Millersburg, Ind., a company which already is licensed to sell motorhomes and travel trailers in Oklahoma.

The action was taken Tuesday by the Oklahoma Motor Vehicle Commission as a stop-gap measure pending a study on state laws and rules and regulations covering conversion vehicles.

Executive Director Noel Kruger was authorized to begin the proposed rules change process by researching other states' laws dealing with similar issues. Public hearings also are planned on the subject. No date was set for these.

While the issue, at first glance, appears to be fairly clear-cut, there is a lot of controversy surrounding it.

The issue is basic, Floyd said, during a hearing before the commission. It's simply a question of whether a company has the right to sell its products in Oklahoma, whether his dealership has the right to handle that product and whether consumers have a right to buy that product.

"It's more a matter of taxation than basic rights," said commission attorney John Rothman of Tulsa. "The issue we are considering is whether a dealer should be allowed to have a license to sell this motor vehicle and have a tax exemption."

According to state law and commission regulations, Rothman said, a dealer must be authorized by the chassis manufacturer to perform certain pre-delivery procedures and post-sale warranty work. Floyd is not authorized by the pickup manufacturer to perform such work, he said.

The issue revolves around the question of what constitutes a conversion or secondary manufacturer of a motor vehicle.

Under current regulations a company which performs conversions on vehicles, such as vans, places its name on the vehicle and sells it through its own dealer network.

"Our real question here," said Commissioner Mike Johnson of Kingfisher, "is what degree of work is required for a vehicle to become a conversion?"

That question must be answered, Yoder said, because more recreational vehicle manufacturers are studying designs similar to Carriage's because of public demand.

"Within a few years," he said, "all (recreational vehicle) dealers here (in Oklahoma) will need some specialty tow unit.

"Consumers want something like a trailer they can pull, then park and unhitch and drive away. This will provide competition to the motorhomes which require owners to pull a separate car behind them if they want freedom after they park."

Consumer demand will force manufacturers to build this type of specialty tow unit, Yoder said.

"If they can't buy it in Oklahoma, they'll go out of state for it," he said. "This will mean that Oklahoma will lose revenues not only on the tow vehicle but the trailer also, because with the price of these, buyers want to buy them as a single unit."

Refusing dealer licenses would put Oklahoma business people at a disadvantage, Floyd said.

"We can still sell the vehicles," he said. "It would just mean that we would have to buy them, pay taxes and tag them, then sell them as used vehicles.

"That would be double taxation and raise the price. It means that we would not have level competition with dealers in other states."

While the issue has been limited thus far to vans which have been converted into recreational vehicles by modifying the interior and adding equipment, more and more conversions are involving other types of vehicles. …