Proposed MVDA amendment will harm the industry and not help consumers.

In Ontario, long overdue changes are being proposed around the Motor Vehicle Dealers Act. While some of those are being welcomed by automotive retailers in Ontario, others, such as the two-day “cooling off” period for consumers are likely to prove highly detrimental to the industry.

The Motor Vehicle Retailers of Ontario (MVRO) recognizes the seriousness of this issue and is urging dealers to contact their local MPPs and notifying the Government of Ontario that a cooling-off period is a bad idea. To gain more insight into this issue and changes being proposed to the MVDA, Autosphere spoke with Frank Notte, Director, Government Relations, with MVRO.

Autosphere: Essentially, what are the changes being proposed to the Motor Vehicle Dealers Act in Ontario?

Frank Notte: The Ministry of Public and Business Service Delivery is consulting on potential changes to the Motor Vehicle Dealers Act. There are 14 proposals being considered and seeking input from the public and industry. These proposals include red tape cutting measures, updating contract disclosures and a two-day cooling off period. The consultation document can be found here.

AS: What were some of the factors that led to the creation of this proposed “cooling off” period?

FN: I believe the proposal for a cooling-off period is a direct result of the 2021 Ontario Auditor General’s Report. In that report, the Auditor General recommended a cooling-off period, due to the perceived lack of consumer protection legislation. We disagree with the Auditor General’s assessment. Ontario has among the strongest consumer protection legislation in North America. In fact, most provinces have modelled their vehicle sales legislation after Ontario’s. The Auditor’s expertise is financial accountability and good governance practices. That Office has no expertise in understanding all the nuances of a vehicle sale and the different entities involved—and the negative effect it would have on the industry. I find it odd that the Auditor General would recommend such a policy that is outside the scope of what that Office is tasked to do – to hold government agencies and departments financially accountable, find efficiencies and ensure good governance. For some time, consumer groups have also been pushing for a cooling-off period.

AS: Can you tell us why a “cooling off period” would be detrimental to automotive retailers in the province?

FN: A cooling-off period is unnecessary and creates red tape for an already detailed transaction. Rather than focussing on helping the public purchase vehicles, a cooling-off period would add more administrative burdens for dealership staff. For example, having to keep track of when the cooling off period starts and ends, managing inventory becomes more challenging, and greater uncertainty for dealership staff whether or not to start the process of preparing the deal and arranging for financing. And since manufacturer programs run monthly, this adds another complexity should the cooling-off period span two different months (for example, the last day of one month, and the first day of the next month). Ontario already has the some of the strongest consumer protection laws in North America when it comes to auto sales. Adding more time and delays would increase the cost of doing business, and force salespeople and other dealership staff to work for free if a cooling off period is enacted.

AS: How can dealers ensure their voices are heard in Queen’s Park?

FN: Dealers can ensure their voice is heard by sending provincial officials an email stating their opposition to a cooling-off period. By now, MVRO members would have received a template email they can customize and send to the MVDA consultation department, Premier Ford, Minister Todd McCarthy and their local MPP. We have made it incredibly easy for them to participate—and can be done in under a minute. By being united on this issue, we can harness the collective voice of the 45,000 women and men who work at new car dealerships and send a message that a cooling-off period is a bad idea. Our members must not be shy about speaking up and letting their positions be heard.

AS: Is there anything else you’d like to mention regarding the updated MVDA Act and “cooling off” period?

FN: The MVRO is pleased to see burden reducing measures being considered. For example, many of our members have suggested the Motor Vehicle Dealers Act be changed to allow offsite transactions from a dealer’s fixed address. This would allow more choice and convenience for both dealers and consumers—should both parties agree to transact this way. We believe that such a policy be optional should a dealer wish to offer this service. We are also pleased to see the Ministry consider extending the time-period for dealers to provide a warranty seller the required documentation and payments received from seven days to thirty days.