Little-known board helps California new car buyers resolve disputes

As state entities go, the New Motor Vehicle Board operates well under the public radar, is rarely in the news and seldom mentioned by car buyers.

That’s ironic considering that the Sacramento-based board mediates disputes between consumers and new car dealers or manufacturers in the most motor vehicle-centric state in the nation.

The nine-member NMVB is a program within the state Department of Motor Vehicles with oversight by the California State Transportation Agency.

The NMVB was created in 1967 as the New Car Dealers Policy and Appeals Board, which had relatively limited powers. In 1973, the state Legislature passed the California Automobile Franchise Act, giving the board its present name and expanding its powers to regulate and settle disputes in the Golden State’s new-vehicle industry.

Most of the time, the board acts in a quasi-judicial capacity to resolve disputes between franchised auto dealers and manufacturers/distributors of new motor vehicles.

In addition, however, the NMVB’s Consumer Mediation Services Program aims to resolve disputes between consumers and new motor vehicle dealers, or manufacturers/distributors.

The NMVB mediation program covers a wide range of vehicles, including passenger cars, heavy-duty trucks, motorcycles, all-terrain vehicles and recreational vehicles. In short, it has the potential to provide a satisfactory outcome for disgruntled car buyers who feel mistreated and maybe even intimidated by the massive auto industry.

In recent years, the board has mediated 300 to nearly400 disputes annually. In fiscal year 2013-14, there were 302 mediation hearings out of 824 initial phone calls/contacts; in 2014-15, that jumped to 380 consumer mediation hearings out of 726 initial contacts.

“The consumer program is very helpful. About 70 percent that come to us walk away with a resolution,” said William Brennan, the board’s executive director.

Given the average of around 1.9 million new car registrations statewide annually over the past three years, a tiny number of consumer disputes reach the board. Brennan notes that most new vehicle sales transactions result in satisfied buyers, and many disputes get settled between buyer and seller as a general rule.

Even so, Brennan believes that most California car buyers are not aware of the NMVB’s mediation option, and the board “is willing to make our services available when needed.”

The mediation program handles a wide range of disputes, including those involving purchase and service contracts, warranty coverage, financing, safety concerns and advertising or dealer claims.

The NMVB does not mediate purchases at dealerships that sell used cars exclusively or transactions between private parties. Likewise, it does not handle California “Lemon Law” disputes, and the recent, nationwide legal action involving tainted diesel cars manufactured by Volkswagen was outside its jurisdiction.

Brennan also explained that the NMVB does not function as either a judge or a court: “Consumers are told up front that we don’t have enforcement capacity … but with mediating their claims with a manufacturer or dealers, depending on where the problem lies.”

Brennan added that the mediation process also helps consumers and attorneys navigate California’s complex vehicle code sections, which include consumers’ legal rights and options as motor vehicle buyers. One of the additional attractions of the program is avoiding litigation costs.

Brennan said disputes that are not resolved through NMVB mediation typically go on to small-claims court or a legal arbitration process.

The board usually meets quarterly but will meet more often if the number of disputes is higher than usual.

The NMVB consists of four licensed motor vehicle dealers – all appointed by the governor – and five members of the public, three appointed by the governor and one each appointed by the state Senate and Assembly.

Mark Glover: 916-321-1184, @markhglover

For more information

The New Motor Vehicle Board, go to or call 916-445-1888. The board’s offices are at 1507 21st St., Suite 330 in Sacramento.