California DMV Investigates Volvo's Subscription Service
A claim made by the California's franchise dealers asserts that Volvo Car USA's Care by Volvo violates the state's vehicle code by creating competition between the automaker and its dealers.
Photo via Flikr.
The Department of Motor Vehicles will begin investigating Volvo Car USA's Care by Volvo after the California New Car Dealers Association successfully pleaded to the New Motor Vehicle Board on Aug. 15.
A petition filed in January by the association presented arguments against Volvo, claiming that as a licensee of the DMV the program violates the California Vehicle Code.
Through the subscription service, Volvo has customers lease their cars directly from them instead of buying or leasing from a Volvo dealership. It offers customers a two-year leasing agreement with a fixed monthly charge that includes the cost of the vehicle, insurance, maintenance, and more. At this time, only two Volvo models, the XC40 and the S60 are being offered through the program.
The program is illegal and violates several provisions in the vehicle code aimed at protecting franchisees and consumers, according to the association that represents nearly 1,200 new car dealerships statewide.
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