Session 8: Legal and Economic Aspects of Facility Margin Programs
Speakers:
Charles Gallaer, ArentFox Schiff
Max McDevitt, The Fontana Group
In this talk, we discuss legal and economic aspects of facility margin programs. We provide an overview of these programs and their relationship to state dealer statutes. We discuss benefits various parties receive from these programs and characteristics that make “opting-in” more attractive to dealerships. We analyze the economic implications of facility margin programs on retail competition and the relationship between per-vehicle incentive payments and wholesale price discrimination, demonstrating facility margin programs
impact dealerships even if they do not “opt-in.” We draw on experiences litigating facility margin disputes to comment on the ways manufacturers and dealerships characterize facility margin programs to the courts. Finally, we discuss the reception of these characterizations by the courts.