Mark Nantais, Rick Gauthier, and David Adams sign NADAP agreement.
After months of negotiations, it took a few strokes of a pen this afternoon at the Markham, Ont. offices of the Canadian Automobile Dealers Association (CADA) for Canada’s automobile dealers to have strengthened protections in place for their businesses.
At a signing ceremony this afternoon, the National Automobile Dealer Arbitration Program (NADAP) was renewed for another five-year term until January 2017.
The signatory representing dealer interests was the Canadian Automobile Dealers Association, and the Canadian Vehicle Manufacturers’ Association (CVMA) and the Association of International Automobile Manufacturers of Canada (AIAMC) represented the OEMs.
“This is a historic day,” said Rick Gauthier, CADA’s President and CEO. “We all worked hard to get this agreement updated and strengthened to better protect the interests of dealers. CADA maintains that NADAP is the most effective dispute resolution mechanism currently available to dealers and we believe that its renewal is a sign that it is working.”
“We are very pleased to be here today signing the agreement,” said Mark Nantais, President of the Canadian Vehicle Manufacturers’ Association (CVMA) in an interview with Canadian auto dealer. “It is a reflection of the very strong relationship that exists between the three associations that signed the agreement. It shows a great deal of confidence in what dealers and manufacturers have put into the agreement.”
He called the renewal an “amazing milestone,” that is working well. “Not only is it a very effective program, but it’s also a program which is continually being brought up to date.”
The CVMA is the national association representing Canada’s manufacturers of light and heavy-duty motor vehicles, including Chrysler Canada, Ford Motor Company, General Motors and Navistar Canada.
“The NADAP process keeps the relationships in our industry strong,” said David Adams, President of the Association of International Automobile Manufacturers of Canada (AIAMC), the national industry association representing the Canadian interests of 15 of the world’s automakers.. “For the entire industry we are better off working together collectively than we are sometimes fighting one another.”
“One of the good things about the renewal process is that it brings NADAP back onto the radar screens of the senior executives,” said Adams, in an interview. “It helps ensure both sides know what their responsibilities are, and also what the benefits of the program are too.”
It was CADA’s third review of the program since it first launched in 1996. NADAP serves as a mediation/arbitration program developed by the automobile industry to help resolve disputes between a dealer and its manufacturer arising under the terms of the Dealer Sales and Service Agreement.
The program launched with almost 95 per cent of Canadian dealers signing Implementation Agreements with their manufacturers that committed them to NADAP for an initial five-year term during which neither the dealer nor the manufacturer could terminate its application to them. The parties agreed, however, to review the program every five years to ensure the program functioned as it was intended to, and was updated to reflect the constantly changing industry.
The first review in 2001 resulted in enhancements to the program, as did a second review in 2006. For the 2011 review, CADA created a committee made up of dealers, CADA provincial association representatives and CADA staff who met regularly to determine whether the program continued to meet dealers’ needs. Dealers were also surveyed for their input, and the committee studied the results of disputes that went to mediation and arbitration.
CADA says that while it does not seek to foster an environment of disagreement between dealers and their respective manufacturers, it recognizes that, at times, disputes will occur.
CADA maintains that since its inception, NADAP has served Canadian dealers well and that the vast majority of disputes brought under NADAP have been resolved at the mediation level.
The fact that most disputes under NADAP are resolved at the mediation stage, means that dealers save money in legal fees, are not engaged in protracted legal disputes and most importantly, can return to the operation of their business much sooner, says CADA.
