Oklahoma sets vehicle definitions and franchise-ending rules for dealers

The law defines terms used in Oklahoma’s motor-vehicle franchise statutes. The definitions cover motor vehicles, powersports vehicles, dealers, manufacturers, distributors, franchises, consumer data, fleet vehicles, and related businesses. A motor vehicle must generally be a motor-driven vehicle that must be registered in Oklahoma. Recreational vehicles and powersport vehicles are excluded from the motor-vehicle definition. Powersports vehicles include certain motorcycles, scooters, mopeds, all-terrain vehicles, and utility vehicles, subject to listed exceptions. These definitions apply when the act takes effect on November 1, 2026, to the statutes and sections listed in the definition section.

A manufacturer must have good cause, give required notice, and follow the listed procedures before ending a licensed dealer’s franchise. The rules apply to licensed new motor vehicle dealers and powersports vehicle dealers, their manufacturers, and in some cases distributors. Most franchise endings require at least 90 days’ notice. Certain events, including insolvency, bankruptcy, seven straight business days without customary operations, or specified convictions, allow at least 15 days’ notice. Ending a product line requires at least 180 days’ notice. A dealer may protest within 30 days and request a hearing, and the franchise remains in force during the hearing and any appeal. The rules apply to franchise terminations, cancellations, and nonrenewals occurring under the act beginning November 1, 2026.

A manufacturer or distributor must provide specified compensation or facility assistance when it wins a franchise-ending action, especially after discontinuing a product line. The provisions cover eligible vehicle inventory, parts, supplies, equipment, tools, dealership facilities, leases, and losses tied to a discontinued product line. Compensation for inventory cannot be less than the dealer’s net purchase price; other items generally receive depreciation deductions. Facility assistance depends on ownership, lease terms, facility use, written requests, and the dealer’s efforts to limit losses. A product-line discontinuation may require payment of the franchise’s fair market value, a replacement franchise, facility help, and certain financial losses. Payments for listed items are generally due within 90 days after the termination takes effect or after value and supporting documentation are established, as the applicable provision specifies.