While some courts have found manufacturer-enacted sales metrics have been unfairly used to measure auto dealer performance, dealers across the country still face ever-increasing pressure to meet what are often unattainable standards, say three Harris Beach Murtha attorneys.

Attorneys Thomas S. Vangel, Lindsey M. McComber and James F. Radke, members of the firm’s Automotive and Vehicle Dealerships Industry Team, discussed the subject of sales metrics imposed on auto dealers in their recent column for the Massachusetts State Auto Dealers Association.

They wrote that, in an effort to increase profits, manufacturers have evaluated their dealers’ performance using metrics that often fail to account for variables outside of the dealers’ control.

“While dealers have had some success challenging their validity, manufacturers are still using these metrics to justify performance-based terminations of Massachusetts dealerships or prevent changes in their ownership or management,” they wrote.

By Massachusetts law, a manufacturer is required to inform a dealer in writing at least 180 days before sending a notice of termination or nonrenewal based on failure to comply with the manufacturer’s sales performance criteria. The manufacturer is required to inform the dealer of the specific sales performance deficiency and explain how the dealer can cure the deficiency through sales performance. The dealer then has 180 days to cure the deficiency before the manufacturer can issue a notice of termination.

“Massachusetts dealers should reach out to counsel as soon as they are notified of any deficiency in sales performance,” the attorneys wrote. “It is important to provide a detailed response to all such notices to create a record of the dealer’s position, document any steps the dealer is taking to address legitimate deficiencies, and, where applicable, to address factors that could be used to challenge the manufacturer’s performance criteria.”

Read the full column for more details.