The Issue The issue is whether Petitioners should be permitted to establish an additional dealership for the sale of motorcycles manufactured by Zhejiang Taizhou Wangye Power Company, Ltd. ("ZHEJ").
Findings Of Fact Based on the evidence adduced at hearing and the record as a whole, the following Findings of Fact are made: On April 17, 2009, the Florida Administrative Weekly published a notice that JCL International intended to allow the establishment of Extreme Motor Sales as a dealership for the sale of motorcycles manufactured by ZHEJ at the Orange Blossom Trail location. The notice also stated that the "new point" location for the proposed dealership is in a "county of more than 300,000 population, according to the latest population estimates of the University of Florida, Bureau of Economic and Business Research." Respondent is an existing franchised dealer of motorcycles manufactured by ZHEJ. Respondent's dealership is located at 306 West Main Street in Apopka, Florida. The driving distance between Respondent's dealership and the location of the new dealership that JCL International proposes to establish is 3.89 miles.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Highway Safety and Motor Vehicles issue a final order denying Petitioners, Galaxy Powersports, LLC, d/b/a JCL International, LLC, and Extreme Motor Sales, approval to establish a new ZHEJ motorcycle dealership at 1918 South Orange Blossom Trail, Apopka, Florida. DONE AND ENTERED this 12th day of January, 2010, in Tallahassee, Leon County, Florida. S CAROLYN S. HOLIFIELD Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 12th day of January, 2010.
The Issue The issue is whether Petitioners are entitled to a proposed motor vehicle dealership in Seminole County, Florida.
Findings Of Fact DOAH provided the parties with adequate notice of the final hearing. On December 3, 2008, DOAH mailed a Notice of Hearing to each of the parties, scheduling the final hearing for April 8, 2009. No Notice was returned as undelivered. No party objected to a final hearing on April 8, 2009. On December 3, 2008, DOAH also issued an Order of Pre- hearing Instructions that, in relevant part, required the parties to file a pre-hearing stipulation, which was to include a list of witnesses and exhibits to be called and submitted at the final hearing. No party complied with the Order. The documents forwarded to DOAH by the Department support the findings. The Notice of Publication for a New Point Franchise Motor Vehicle Dealer in a County of More than 300,000 Population was published in the Florida Administrative Weekly, Volume 34, Number 43, on October 24, 2008. On behalf of Respondent, Mr. James Sursely timely filed a protest letter dated November 7, 2008, with Ms. Nalini Vinayak, the administrator at the Department responsible for receiving such protests. The remaining facts are undisputed in this proceeding. The proposed new point franchise motor vehicle dealer is for a line-make identified in the record as Chongqing Lifan Industry Group Co. Ltd. (CHOL) motorcycles. The proposed location is in Seminole County, Florida. Seminole County has a population in excess of 300,000. The proposed new point franchise motor vehicle dealer is located at 3311 West Lake Mary Boulevard, Lake Mary, Florida. Respondent owns and operates an existing CHOL dealership that is located at 306 West Main Street, Apopka, Orange, County, Florida 32712. The proposed dealership is within a 12.5-mile radius of Respondent's dealership. Respondent has standing to protest the establishment of the proposed dealership. The petitioners submitted no evidence that Respondent is "not providing adequate representation" of the same line-make motor vehicles in the community or territory.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order denying the establishment of the proposed franchise dealership. DONE AND ENTERED this 23rd day of April, 2009, in Tallahassee, Leon County, Florida. S DANIEL MANRY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 23rd day of April, 2009.
The Issue Whether the application of Peace Industry Group (Peace) and Bayside Auto Sales, Inc. (Bayside) to establish an additional franchised dealership for the sale of Astronautical Bashan motorcycles to be located at Bayside Auto Sales, 1301 Harrison Avenue, Panama City, Bay County, Florida, should be granted.
Findings Of Fact Petitioner Peace is a licensed distributor of motor vehicles in Florida and is authorized to sell motor vehicles to its dealers in Florida. Petitioner Bayside is a licensed motor vehicle dealer in Florida and is located at 1301 Harrison Avenue, Panama City, Florida. Respondent Moto is a licensed motor vehicle dealer in Florida and an existing Astronautical Bashan dealer located at 12202 Hutchison Blvd Suite 72, Panama City Beach, Florida. Currently, Moto sells the product line of Peace, including the Astronautical Bashan product line. Additionally, Moto has a franchise agreement with Peace. The agreement establishes a franchise territory with a 25-mile radius around Moto’s location. Petitioner Peace proposes to establish Bayside as a dealership for the sale of Astronautical Bashan motorcycles. The proposed dealership would be within six miles of Moto’s dealership. The two dealerships are located in Bay County and are separated by the Hathaway Bridge. Both draw customers from Bay County, with at least 20 percent of Moto’s customers located within 20 miles of Moto’s location. There was no consumer data or analysis of sales in the motorcycle industry offered into evidence. However, Moto’s franchise agreement with Peace establishes a market area of at least a 25-mile radius from Moto’s location. Bayside clearly is located within Moto’s market area. There was no evidence which demonstrated Peace’s market share in the motorcycle market. There was no evidence presented analyzing the motorcycle market in the Panama City area. Likewise, there was no evidence presented regarding anticipated growth in the market area. This type of evidence is generally presented by the distributor or manufacturer of the product. As indicated, Peace did not appear at the hearing. Given this lack of evidence, the market share for Peace or Astronautical Bashan motorcycles cannot be established. Moreover, a determination that the establishment of a second dealership in the Panama City territory is warranted must be based on the economic and marketing conditions pertinent to dealers competing in the territory. Given this lack of evidence, Petitioners failed to establish that Peace was underrepresented in the Panama City/Bay county area. Since there is no evidence to support the establishment of a second dealership, Petitioners’ application to establish such a dealership should be denied.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Highway Safety and Motor Vehicles enter a final order denying the establishment of Peace's dealership at Bayside, 1301 Harrison Avenue, Panama City, Florida. DONE AND ENTERED this 13th day of February, 2009, in Tallahassee, Leon County, Florida. S DIANE CLEAVINGER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 13th day of February, 2009. COPIES FURNISHED: Michael James Alderman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A-432 2900 Apalachee Parkway Tallahassee, Florida 32344 Larry Bradberry Bayside Auto Sales, Inc. 1301 Harrison Avenue Panama City, Florida 32401 Wayne Wooten Moto Import Distributors, LLC 12202 Hutchison Boulevard, Suite 72 Panama City Beach, Florida 32407 Lily Ji Peace Industry Group, Inc. 6600-B Jimmy Carter Boulevard Norcross, Georgia 30071 Carl A. Ford, Director Division of Motor Vehicles Department of Highway Safety And Motor Vehicles Neil Kirkman Building, Room B-439 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Robin Lotane, General Counsel Department of Highway Safety And Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500
Conclusions This matter came before the Department for entry of a Final Order upon submission of an Order Closing File by Patricia M. Hart, Administrative Law Judge of the Division of Administrative Hearings, pursuant to Petitioner's request for withdrawal, a copy of which is attached and incorporated by reference in this order. The Department hereby adopts the Order Closing File as its Final Order in this matter. Accordingly, it is hereby ORDERED that this case is CLOSED and no license will be issued to Moto Dealer Import, LLC and Continental Motor Group, Inc. to sell motorcycles manufactured by Benzhou Vehicle Industry Group Co. Ltd. (SHWI) at 885 Southeast Monterey Road, Stuart (Martin County), Florida 34994. Filed December 17, 2009 8:31 AM Division of Administrative Hearings. DONE AND ORDERED this /54,of December, 2009, in Tallahassee, Leon County, Florida. Division of Motor Vehicles Department of Highway Safety and Motor Vehicles Neil Kirkman Building Tallahassee, Florida 32399 Filed with the Clerk of the Divis/kthf Motor Vehicles this uday of December, 2009. ,.<.;?C?.c,,Dealllr7lcenieAdmlnistratorNOTICE OF APPEAL RIGHTS Judicial review of this order may be had pursuant to section 120.68, Florida Statutes, in the District Court of Appeal for the First District, State of Florida, or in any other district court of appeal of this state in an appellate district where a party resides. In order to initiate such review, one copy of the notice of appeal must be filed with the Department and the other copy of the notice of appeal, together with the filing fee, must be filed with the court within thirty days of the filing date of this order as set out above, pursuant to Rules of Appellate Procedure. Copies furnished: Jack Lin Moto Dealer Import, LLC 4998-B South Royal Atlanta Drive Tucker, Georgia 30084 Mark Mourning Wenmark, Inc. d/b/a All The Wheel Toys 1540 Northwest Federal Highway Stuart, Florida 34994 Onofrio Bruno Continental Motor Group, Inc. 885 Southeast Monterey Road Stuart, Florida 34994 Patricia M. Hart Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 Michael J. Alderman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway, Room A432 Tallahassee, Florida 32399 Nalini Vinayak Dealer License Administrator Florida Administrative Law Reports Post Office Box 385 Gainesville, Florida 32602
The Issue The issue is whether the Petitioners' proposal for a dealer to sell two new lines of motorcycles should be approved.
Findings Of Fact On October 10, 2008, in the Florida Administrative Weekly, Volume 34, Number 41, two separate Notices of Publication for a New Point Franchise Motor Vehicle Dealer in a County of More than 300,000 Population were published. The first notice provided, in relevant part, as follows: Pursuant to Section 320.642, Florida Statutes, notice is given that [Galaxy] intends to allow the establishment of [Treasure Coast] as a dealership for the sale of motorcycles manufactured by Taizhou Zhongneng Motorcycle Co. Ltd. (ZHNG) at 7320 South U.S. 1, Port St. Lucie (St. Lucie County) Florida 34952 on or after September 26, 2008. The second notice provided, in relevant part, as follows: Pursuant to Section 320.642, Florida Statutes, notice is given that [Galaxy] intends to allow the establishment of [Treasure Coast] as a dealership for the sale of motorcycles manufactured by Zhejiang Taizhou Wangye Power Co. Ltd (ZHEJ) at 7320 South U.S. 1, Port St. Lucie (St. Lucie County) Florida 34952 on or after September 26, 2008. On October 16, 2008, Respondent filed the following letters of protest with the Department of Highway Safety and Motor Vehicles: In regards to the intent of [Galaxy] to establish a Taizhou Zhongneng Motorcycle Co. Ltd. (ZHNG) with [Treasure Coast] for the sale of motorcycles at 7320 South U.S. 1, Port St. Lucie, Fl [sic] 34952. This letter represents a written complaint to their application for this dealership, because we already represent said dealership. and In regards to the intent of [Galaxy] to establish a Zhejiang Taizhou Wangye Power Co. Ltd (ZHEJ) with [Treasure Coast] for the sale of motorcycles at 7320 South U.S. 1, Port St. Lucie, Fl [sic] 34952. This letter represents a written complaint to their application for this dealership, because we already represent said dealership. Both letters made the following additional representations: The proposed dealership would be within 20 miles of our dealership, as measured by straight line distance. They are 8.61 miles away per mapquest. The proposed dealership is to be located within the contractual area outlined in our dealer agreement, as we have a 20 mile exclusivity. We have made more than 25% of our retail sales to persons whose registered household addresses are within 20 straight line miles of the proposed dealership during the past 12 month period. By letter dated October 22, 2008, the Department apparently tried to refer this matter to DOAH. For reasons that were not explained, however, this matter was not received at DOAH until it was referred again by letter dated June 3, 2009. The protest filed by Respondent was timely. The parties agreed that the population of St. Lucie County is over 300,000, and that Respondent's dealership is 8.61 miles from the proposed site. Respondent has dealer agreements to sell various lines of motorcycles, including motorcycles manufactured by Zhejiang Taizhou Wangye Power Co., Ltd. (ZHEJ); and motorcycles manufactured by Taizhou Zhongneng Motorcycle Co. Ltd. (ZHNG). At the hearing, Mr. Young agreed that the evidence showed that, as a dealer for Zhejiang Taizhou Wangye Power Co. Ltd. (ZHEJ), Respondent has adequately promoted that line and has made 25 percent or more of its retail sales to household addresses within 12.5 miles of the proposed dealership. At the hearing, Mr. Young said that the only motorcycles at issue were those manufactured by Taizhou Zhongneng Motorcycle Co. Ltd. (ZHNG). Specifically, he questioned whether the line represented sufficient numbers of sales within the territory. Mr. Mourning explained that the ZHNG line was also called ZNEN before 2009. He produced records that confirm that Taizhou Zhongneng Motorcycle Co. Ltd., used ZNEN as the make of its vehicles in 2008. Taken together, his sales records for ZHNG and ZNEN motorcycles demonstrated that he also adequately and successfully represents that line in the territory.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Department of Highway Safety and Motor Vehicles enter a Final Order denying Treasure Coast's applications to become the licensee to sell motorcycles line-makes manufactured by Zhejiang Taizhou Wangye Power Co. Ltd. (ZHEJ); and by Taizhou Zhongneng Motorcycle Co. Ltd. (ZHNG) at the proposed site. DONE AND ENTERED this 2nd day of November, 2009, in Tallahassee, Leon County, Florida. S ELEANOR M. HUNTER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 2nd day of November, 2009. COPIES FURNISHED: Electra Theodorides-Bustle, Executive Director Department of Highway Safety and Motor Vehicles 4052 Bald Cypress Way, BIN A02 Tallahassee, Florida 32399-1701 Robin Lotane, General Counsel Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2009 Apalachee Parkway Tallahassee, Florida 32399-0500 Guy Young J & F South Florida Investments, Inc. d/b/a Treasure Coast Scooters and Things 7320 South US 1 Port St. Lucie, Florida 34952 Mark Mourning WenMark Inc., d/b/a All The Wheel Toys 1540 Northwest Federal Highway Stuart, Florida 34994 Jennifer Clark, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A-308 2900 Apalachee Parkway Tallahassee, Florida 32399-0635 Leo Su Galaxy Powersports, LLC, d/b/a JCL International, LLC 2667 Northhaven Road Dallas, Texas 75229
The Issue Whether Petitioners are entitled to establish a new motor vehicle dealership that is proposed to be located in Lake Mary, Florida, for the sale of motorcycles manufactured by Zongshen Industrial Group (ZONG).
Findings Of Fact Respondent is an existing franchised dealer of motorcycles manufactured by Zongshen Industrial Group (ZONG). Petitioners have proposed the establishment of a new dealership to sell the same line and make of motorcycles as those sold by Respondent. Respondent's dealership is located at 306 West Main Street, Apopka, Florida 32712. Petitioners' proposed dealership would be located at 3311 West Lake Mary Boulevard, Lake Mary, Florida 32746. The proposed dealership is within a 12.5-mile radius of Respondent's dealership. Respondent has standing to protest the establishment of the proposed dealership. No evidence was presented that there is inadequate representation of such line-make motor vehicles in such community.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the Department of Highway Safety and Motor Vehicles enter a final order denying the establishment of Petitioners' proposed dealership. DONE AND ENTERED this 7th day of April, 2009, in Tallahassee, Leon County, Florida. S DANIEL M. KILBRIDE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 7th day of April, 2009. COPIES FURNISHED: Electra Theodorides-Bustle, Executive Director Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Robin Lotane, General Counsel Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Michael James Alderman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A-432 2900 Apalachee Parkway Tallahassee, Florida 32344 Jason Rupp Wild Hogs Scooters & Motorsports, LLC 3311 West Lake Mary Boulevard Lake Mary, Florida 32746 Mathu Solo LS Motorsports, LLC 10215 South Sam Houston Parkway West, Suite 100 Houston, Texas 77071 James Sursely Action Orlando Motorsports 306 West Main Street Apopka, Florida 32712
The Issue Whether the application of Kawasaki Motors Corporation USA (Kawasaki Motors) to establish an additional franchised dealership for the sale of Kawasaki motorcycles to be located at Action Jet Sports, Inc. (Action Jet), 2705 1st Street, Bradenton, Manatee County, Florida, should be granted.
Findings Of Fact Based on the evidence presented at the hearing and the record as a whole, the following findings of fact are made: Petitioner Kawasaki Motors, is a licensed distributor of motor vehicles in Florida and is authorized to sell motor vehicles to its dealers in Florida. Petitioner Action Jet is a licensed motor vehicle dealer in Florida and is located at 2705 1st Street, Bradenton, Florida. Respondent Granny's Motorsports is a licensed motor vehicle dealer in Florida and an existing Kawasaki dealer located at 2001 University Parkway, Sarasota, Florida. In 1991, Granny's Motorsports was formed from the purchase of an existing dealership known as "Cycles N' Stuff" located on 17th Street in Sarasota, Florida. However, with the approval of Kawasaki Motors, Granny's Motorsports relocated to its present location in July 1997. Granny's Motorsports sold the full product line of licensed motor vehicles for Kawasaki, Yamaha, and Suzuki at its 17th Street location and currently sells the full product line of these manufacturers. Petitioner Kawasaki Motors proposes to allow the establishment of Action Jet as a dealership for the sale of Kawasaki motorcycles. Granny's Motorsports has standing to protest the proposed establishment of Action Jet as a Kawasaki motorcycle dealership pursuant to Section 320.642(3), Florida Statutes. This proceeding is governed by Section 320.642, Florida Statutes, which sets forth the conditions for establishment of an additional dealer if a protest is filed. According to that provision, Kawasaki Motors will be allowed to establish a new dealership if the existing franchised dealer is not providing adequate representation of Kawasaki vehicles in the subject community or territory. While that provision lists factors which may be considered in making this determination, the statute does not define "community or territory" or "adequate representation." A determination of what constitutes the appropriate "community or territory" is a question of fact that must be made on a case-by-case basis. To determine whether a market is so connected as to form a community or territory, there must be significant cross- sell between the existing dealer in Sarasota/Bradenton and the fringe dealers, those in the surrounding area, to consider if they are, in fact, acting as one market. The consumer data used for analysis of sales in the motorcycle industry is assembled and provided by the Motorcycle Industry Council (MIC). Although MIC data contains information for all motorcycle products for the purposes of establishing adequacy of representation under Section 320.642, Florida Statutes, only information relative to on-road motorcycles and dual-purpose motorcycle sales has been considered. Six Kawasaki dealers in Pinellas, Hillsborough, Polk, and Charlotte counties occupy the area surrounding the Manatee and Sarasota county area. Consumer behavior data indicates that very few of the Kawasaki sales made by these six dealers are made to customers residing in Sarasota and Manatee counties. Rather, the vast majority of the sales into Sarasota and Manatee counties is made by Granny's Motorsports. After excluding these fringe dealers from the potential community or territory, it was necessary to determine whether there was sufficient cross-sell within Sarasota County and Manatee County to determine whether these two counties are connected from a Kawasaki marketing standpoint. However, because the proposed dealer in Bradenton is not in place yet and there is only one existing dealer in the area, there is no cross-sell and this analysis is not possible. Analysis of consumer behavior and cross-sell patterns demonstrate that, for Kawasaki motorcycles, Sarasota and Manatee counties are a single market and comprise the Bradenton/Sarasota community or territory for the purpose of analysis under Section 320.642, Florida Statutes. A primary market area (PMA) or identifiable plot, in which an existing or proposed resident dealer has or should have a competitive advantage over same line-make dealers by virtue of the resident dealer's location. Each dealer, including Granny's Motorsports, is assigned a primary market area of a radius of five miles around his dealership. However, this distance was considered to be too small to constitute a reasonable area for market analysis. The starting point for establishing the PMAs for Granny's Motorsports and the proposed Bradenton dealership, Petitioner Action Jet, was the assignment of zip codes within the Bradenton/Sarasota community or territory. Utilizing this process, generally, zip code areas closest to Granny's Motorsports were assigned to that dealer and those zip code areas closest to the proposed Bradenton dealership, Action Jet, were assigned to that dealership. However, in certain instances, although the center of a zip code was closer to one dealer, the roads and traffic patterns suggested that a zip code should be assigned to a different dealer's PMA. This situation was present in this case and, accordingly, several zip codes were assigned on a basis other than distance. The Sarasota PMA is the area in which Granny's Motorsports is located and in which it has a geographic advantage. Moreover, Granny's Motorsports will continue to have that advantage even after the establishment of Action Jet. The Bradenton PMA is the area in which the proposed Action Jet dealership would have an advantage upon its establishment. In the Bradenton/Sarasota community or territory, there are eleven competing line-make motorcycle dealers. To determine whether the existing Kawasaki dealers are providing "adequate representation" in the Bradenton/Sarasota community or territory, the factors enumerated in Section 320.642, Florida Statutes, may be considered. The most common measure for evaluating the performance of a dealer network is analysis of market penetration data. Market penetration represents the competitive efforts of all the dealers, using data concerning the sale of all brands to comprise a single indicator also called market share. This is the single most objective and accurate measure of market activity. Market share represents the sales of a manufacturer, such as Kawasaki, in proportion to the business available. To develop a standard to measure adequacy of representation for the Bradenton PMA, the Sarasota PMA, or the community or territory, the first step is to attempt to locate an area near the area being studied, but which does not overlap with that area where Kawasaki is adequately represented. After adjusting for product popularity differences, the Polk County standard offers the most appropriate expected market penetration against which to judge the performance of Kawasaki in the Bradenton/Sarasota community or territory and in the Bradenton and Sarasota PMAs which make up that community or territory. In this case, Polk County, which is adjacent to the Bradenton/Sarasota community or territory, appears to be adequately represented because it exceeds the Florida average for Kawasaki. The Florida average is a conservative standard because it takes into consideration Kawasaki's performance in areas with adequate, inadequate, and no representation. Polk County is also an appropriate starting point for determining a reasonably expected market penetration because it represents actual experience of the Kawasaki penetration which is being obtained in an adjacent area. However, when comparing one market to another, adjustments must be made for consumer preferences which might differ from one market to another. This is important because consumer preferences among different types of motorcycles, independent of brand, are beyond the control of the dealers. Market segmentation adjusts for consumer preferences which differ between markets. Sales data by segment reflects actual consumer purchases, implicitly accounting for the effects of all demographic characteristics including age, income, education, size-class preferences, and product popularity on vehicle purchase behavior. In this proceeding, only on-road motorcycle and dual- purpose motorcycles are considered. With regard to these categories, the MIC classifies motorcycles into five segments. These segments list models which are comparable to one another and are presumably, competing for the same customers. By measuring Kawasaki's penetration in each segment achieved in Polk County, compared to the opportunity available in each segment in the Bradenton/Sarasota community or territory, an appropriate standard is established for what the Bradenton/Sarasota community or territory should expect if it were receiving adequate representation. Using the Polk County average and adjusting for local segment popularity, the reasonably expected market share for Kawasaki on-road and dual-purpose motorcycles in the Bradenton/Sarasota community or territory was 16.47 percent in 1996; 13.69 percent in 1997; 16.70 percent in 1998; and 16.21 percent for the first nine months of 1999. Alternatively, using the more conservative Florida average as a standard and adjusting for product popularity, Kawasaki in the Bradenton/Sarasota community or territory would be expected to achieve 16.24 percent in 1996; 13.49 percent in 1997; 13.94 percent in 1998; and 12.89 percent for the first nine months of 1999. The reasonably expected segment penetration for Polk County, adjusted for local segment popularity, is accepted as the appropriate standard against which to judge the performance of the Bradenton/Sarasota community or territory. After making the market segment adjustments, Kawasaki Motors' market penetration in the Bradenton/Sarasota community or territory was below reasonably expected levels for the period 1996 through the last nine months of 1999. This is the case whether using the Polk County average or the Florida average. The actual penetration of Kawasaki in the Bradenton/Sarasota community or territory was 13.69 percent in 1996; 10.37 percent in 1997; 9.12 percent in 1998; and 6.81 percent for the first nine months in 1999. Using the Polk County average standard, from 1996 through the first nine months of 1999, the Bradenton/Sarasota community or territory's performance declined from 83 percent of expected in 1996 to only 42 percent of expected in 1999. By comparison, utilizing the Florida average as a standard, the Bradenton/Sarasota' performance went from 84.3 percent of expected in 1996 to only 52.9 percent of expected in 1999. The net shortfall in units, or the number of on-road and/or dual-purpose motorcycles, which would be required to be sold in order to bring Kawasaki in the Bradenton/Sarasota community or territory up to the expected performance, was 12 units in 1996, 16 units in 1997, 44 units in 1998, and 51 units in 1999. Using the more conservative Florida standard, the net shortfall increased from 11 in 1996 to 33 in 1999. Similar patterns emerge when Kawasaki's penetration in the Bradenton PMA and the Sarasota PMA is compared with expected penetration based upon the Polk County and Florida standards. Utilizing the segment analysis, Kawasaki's actual performance compared to expected in the Bradenton PMA has fallen from 85.7 percent of expected in 1996 to 53.8 percent of expected in the first nine months of 1999. A temporary effect of the relocation of Granny's Motorsports north to its new location, which opened in July 1997, can be seen as the actual penetration reached 100 percent of expected in 1997. However, since that time, the performance of the Bradenton PMA has continued to fall to a point substantially lower than it was prior to the relocation. Similar results are seen when the Bradenton PMA's performance is compared to the Florida average. Kawasaki's representation in the Sarasota PMA, where Granny's Motorsports is located, also has fallen consistently for the past four years. Using the Polk County standard, Granny's Motorsports went from achieving 82 percent of its expected penetration in 1996 to 35.9 percent in 1999. By comparison, using the Florida standard, the Sarasota PMA went from achieving 83.7 percent of its expected penetration in 1996 to 46 percent in 1999. The steady decline over time demonstrates that Granny's Motorsports, the only dealer in the Bradenton/Sarasota community or territory, may not be able to adequately represent Kawasaki in its own PMA because it is attempting to cover an area which is too large for it to adequately serve. In terms of reasonably expected market penetration, the Bradenton/Sarasota community or territory, as well as the Bradenton PMA and the Sarasota PMA, are not receiving adequate representation for Kawasaki. Factors contributing to Kawasaki's receiving inadequate representation in the Bradenton/Sarasota community or territory and in the Bradenton PMA and the Sarasota PMA may be the number and location of the dealers. However, a determination that the establishment of a second dealership in the Bradenton/Sarasota community or territory is warranted must be based on the economic and marketing conditions pertinent to dealers competing in the community or territory, including anticipated changes. The current and future demographic factors in the Bradenton/Sarasota community or territory indicate that the addition of a Kawasaki Motors dealer is justified in terms of economic or marketing conditions pertinent to dealers competing in the community or territory. The Bradenton/Sarasota community or territory has experienced considerable economic and market growth. Since 1980, the community/territory has had a significant increase in the driving age population and households. This trend is predicted to continue through 2003. An additional indication of the economic growth is the increase in the annual employment. In Sarasota and Manatee Counties, the annual average employment has increased by approximately 52,000 jobs between 1990 and 1999. The Bradenton PMA and the Sarasota PMA have also experienced substantial growth with such trends predicted to continue through 2003. Demographic factors in both the Bradenton and Sarasota PMAs are conducive to selling new motorcycles. They both contain a reasonable mix of upper and middle income areas. The median household income of the new motorcycle buyer falls into the range of around $50,000. In terms of the growth of the total motorcycle industry, as reflected by the on-road and dual-purpose segment, there has been a substantial increase in the amount of the total industry sales, for which Granny's Motorsports can compete, available since 1996. This increase is present in both the Bradenton PMA and the Sarasota PMA. In light of the growth in the total available motorcycle market, measured by total industry sales, coupled with the demographic and employment characteristics, the inadequacy of representation is not due to local demographic or economic factors or lack of growth in the motorcycle industry. Rather, the inadequacy of representation is likely due the inability of one dealer to keep pace with the growth in the market. The distance between Granny's Motorsports and the proposed Action Jet location is 7.8 miles and 19 minutes and 8 seconds driving time. From a geographical standpoint, the Bradenton/Sarasota community or territory is large, approximately 40 to 50 miles from north to south. Despite this large area and the increase in the size of the motorcycle market, the Bradenton/Sarasota community or territory is served by only one Kawasaki dealer. Establishment of an additional Kawasaki dealer is justified based on the size of the market in the Bradenton/Sarasota community or territory, measured in comparison to Polk County and the number of Kawasaki dealers and competitors there. For example, in the Bradenton/Sarasota community or territory, where Kawasaki is receiving inadequate representation, Kawasaki has 9.1 percent of the franchises. In Polk County, where Kawasaki is receiving adequate representation, Kawasaki has 20 percent of the franchises. In order to have the same share of the franchises in Bradenton/Sarasota which it has in Polk County, Kawasaki would be required to have 2.5 dealerships. Therefore, in addition to the one dealership present in the Bradenton/Sarasota community or territory at this time, Granny's Motorsports, one additional Kawasaki dealer is needed. The inadequate market penetration for Kawasaki demonstrates that there is insufficient inter-brand competition, or competition between dealers selling different brands. Moreover, there is no intra-brand competition between Kawasaki dealers because none of the other Kawasaki dealers in the surrounding area sell meaningful numbers of units into the Bradenton/Sarasota community or territory. The proposed location in Bradenton has a concentration of motorcycle purchasers which justifies the placement of a Kawasaki dealership in Manatee County. The establishment of the Bradenton dealership will likely benefit consumers and the public interest. It will provide the growing population of the Bradenton/Sarasota community or territory with a more convenient place to shop for Kawasakis and more convenient Kawasaki service. The probable impact of the proposed additional dealership on the existing Kawasaki dealer can be determined by examining the gross sales loss in the Bradenton/Sarasota community or territory. The gross sales loss is the number of on-road and/or dual-purpose motorcycles sold in the subject community or territory by the competitive dealerships in that area. The gross sales loss in the Bradenton/Sarasota community or territory was 48 units for 1998. In addition to this opportunity being available to the existing Kawasaki dealer, there were 9 units of in-sell or Kawasaki units sold by dealers outside the Manatee and Sarasota Counties to local customers. Thus, there is a total lost opportunity of 57 units for which Granny's Motorsports can compete. If the new proposed dealer is established, there will be no necessary negative impact on Granny's Motorsports because there is opportunity available to be captured from inter-brand competitors. When a dealer is added to a market with inadequate representation, typically, competition is enhanced and the market for the product expands over what it otherwise would have been. The addition of Action Jet will have a positive impact on consumers. It will provide additional competition and a much more convenient shopping alternative. The addition of a dealership will likely benefit Kawasaki Motors in terms of additional sales of motorcycles and market share. Granny's Motorsports has made a substantial investment in its current and previous facilities. In 1991, when Granny's Motorsports purchased an existing dealership located on 17th Street in Sarasota, extensive renovations were performed, the equipment was updated, and the staff was increased and trained. In 1996, Granny's Motorsports purchased the property at which its present dealership is located. After applying for and receiving the approval of Kawasaki Motors, in July 1997, Granny's Motorsports moved into the new facility located on University Parkway in Sarasota. However, the University Parkway facility, which had previously been a boat manufacturing plant, required extensive renovations before Granny's Motorsports could occupy the facility. Granny's Motorsports' total investment in the new facility was about $1,000,000. Although Kawasaki Motors approved the relocation of Granny's Motorsports, it never suggested or recommended the relocation. Therefore, the substantial costs associated with and resulting from Granny's Motorsports' relocation were not incurred to perform obligations under the dealer agreement between Kawasaki Motors and Granny's Motorsports. Rather, the investment and expenditures made by Granny's Motorsports were for the business as a whole, which includes the sale of the full product line of not only Kawasaki, but also of Yamaha and Suzuki. Granny's Motorsports' current location on University Parkway is near the Sarasota and Manatee County line and is centrally located between Sarasota and Bradenton and in the middle of two main clusters of population for the Bradenton/Sarasota community or territory. However, the market share deficiency suffered by Kawasaki demonstrates that the facility is not in a location from which Granny's Motorsports has been able to adequately represent Kawasaki in the community or territory and, in specifically in the Bradenton PMA. By allowing Granny's Motorsports to relocate to the location it requested, Kawasaki Motors allowed Granny's Motorsports the opportunity to take advantage of the growing market within Manatee and Sarasota counties in the manner it requested to do so. Granny's Motorsports has been in the University Parkway facility for over two years, but Kawasaki's market share continues well below an acceptable minimal standard and is declining. Granny's Motorsports is an adequate facility and its owner and manager are doing what they believe is the best they can do to maximize their efforts to sell Kawasaki Motors product. Notwithstanding these efforts, Granny's Motorsports was not been able to effectively service the entire Bradenton/Sarasota community or territory. Prior to 1978, a Kawasaki dealership had been established in Bradenton. That dealership had coexisted with the dealership in Sarasota until it went out of business in 1993 because of an absentee owner and management and operation problems. In fact, when Granny's Motorsports brought its dealership in Sarasota in 1991, the Kawasaki dealership was operating in Bradenton. Kawasaki Motors believes that by replacing the dealership in Bradenton which had been very successful for many years, it will be able to better service the Bradenton/Sarasota community or territory. Kawasaki Motors' low market share compared to expected in the Bradenton/Sarasota community or territory indicates that Kawasaki's one dealer network is currently unable to offer adequate inter-brand competition in the Bradenton/Sarasota community or territory. The failure of the efforts of the existing Kawasaki dealer to reach the minimum expected market share in the Bradenton/Sarasota community or territory demonstrates that the existing Kawasaki dealer is not nearly capturing all reasonably available sales. There is significant untapped market opportunity available in the Bradenton/Sarasota community or territory. This is due, at least in part, to the size of the market and a single dealer's inability to serve the entire market. The market opportunity is so great that Action Jet, the proposed dealer to be established in the Bradenton PMA, likely will not be able to capture all of the increased sales from opportunity currently lost to inter-brand competitors. Therefore, Granny's Motorsports will have the opportunity to increase its current sales level. Having a convenient dealer in the Bradenton/Sarasota community or territory can stimulate new sales interest in Kawasaki across the market. If existing Kawasaki dealers respond aggressively and offer competitive value, they will capture some of the increased sales generated by the presence of the additional dealer in the Bradenton/Sarasota community or territory.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Highway Safety and Motor Vehicles enter a final order approving the establishment of Kawasaki Motors' dealership at Action Jet, 2705 1st Street, Bradenton, Florida. DONE AND ENTERED this 8th day of May, 2000, in Tallahassee, Leon County, Florida. CAROLYN S. HOLIFIELD Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 8th day of May, 2000. COPIES FURNISHED: Dean Bunch, Esquire Kelly A. O'Keefe, Esquire Sutherland, Asbill and Brennan, L.L.P. 2282 Killearn Center Boulevard Tallahassee, Florida 32308 Charles D. Bailey, III, Esquire Bowman, George, Scheb, Toale and Robinson 22 South Tuttle Avenue, Suite 3 Sarasota, Florida 34237 Andrew H. Cohen, Esquire Hankin, Perrson, Davis & Darnell 2033 Main Street, Suite 400 Sarasota, Florida 34237 Charles J. Brantley, Director Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Michael J. Alderman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room A432 2900 Apalachee Parkway Tallahassee, Florida 32399-0500
Findings Of Fact Burruss is a licensed and franchised American Motors dealer. Burruss has been the sole AMC dealer in the Tarpon-West Pasco County area since 1960. Burruss is in compliance with its franchise agreement with American Motors Sales Corporation. Both Burruss and New Port are located on U.S. Highway 19, a distance of six miles from each other. U.S. Highway 19 is the only major north-south thoroughfare in the Tarpon-West Pasco area. Portions of U.S. Highway 19 have been improved in the past years so that much of the highway is six-laned in the Tarpon-West Pasco area; the unimproved portions of the highway are four-laned. The recent improvements to U.S. Highway 19 in the Tarpon-West Pasco area have improved the traffic flow along U.S. Highway 19. (Findings 1 through 6 are contained in the Prehearing Stipulation.) Burruss is located in Tarpon Springs, which is in the northernmost part of Pinellas County. New Port is located in New Port Richey, which is in Pasco County. There is presently no AMC dealer in Pasco County. The closest AMC dealer to the north of Burruss his in Brooksville, some 35 miles to the north. The AMC dealers in the area are in Tampa, some 27 miles south of New Port Richey; in Clearwater, some 25 miles south of New Port Richey; and Burruss in Tarpon Springs, some six miles south of the proposed location. New Port has been a franchised Lincoln Mercury automobile dealer for three and a half years and is fully qualified to operate the proposed franchise. New Port has agreed to build a 1600 square foot showroom, to have mechanics factory-trained, and to spend in excess of $41,000 in advertising the AMC products during its first year of operation. It has also agreed to maintain a 60-day supply of automobiles in stock. Pasco County has been one of the fastest growing Florida counties in the past ten years, with most of this growth in the western part of the county near U.S. 19. In 1970 Pasco County had a population of 76,000, which increased to 193,643 in 1980 (Exhibit NP-1). In 1981 a study was conducted in the Pasco County area to determine if there was an open point in this area. A copy of this report was submitted as Exhibit NP-2. From this study AMC determined that the area previously serviced by Burruss should be divided into two areas with the southern area comprising the areas containing the zip codes of Tarpon Springs, Crystal Beach, Holiday, Ozone, and Palm Harbor. This is designated the new Tarpon Springs area. All of these communities are in Pinellas County except Holiday, which is in Pasco County. The northern area, which comprises west Pasco County and is the area in which it is contended that AMC is inadequately represented, includes the zip codes for New Port Richey, Aripeka, Elfers, Odessa, and Port Richey. After obtaining the results of this study, American Motors Sales Corporation solicited dealers in this area to apply for an AMC franchise. Burruss became an AMC dealer in 1960, a Jeep dealer in 1970, and a Renault dealer in 1979. Burruss also sells Datsun vehicles, the sale of which runs 25 to 30 percent, by number of units, above its sales of the AMC-Jeep- Renault line, despite the fact that a competing Datsun dealer is located in Pasco County approximately three miles north of Burruss on U.S. 19. During the past ten years ten major shopping malls or plazas have been built in the New Port Richey-West Pasco area, the number of banks or savings and loan institutions have grown from ten to more than 65, and six new car dealerships have been established, to bring the total to nine. Burruss' sales of AMC vehicles reached a peak of 200 per year in 1975 and have steadily declined since that time. Cross-sales figures show that from 45 percent to 75 percent of the AMC-Jeep-Renault vehicles sold in the New Port Richey area are sold by dealers other than Burruss. Of the three AMC dealers in Pinellas County, Burruss has consistently sold the fewest vehicles. Since the population has been greater in the service area of the other two AMC dealers in Pinellas County, this lower rate would be expected. However, Burruss sales have not kept pace with the population growth in the New Port Richey-West Pasco area. In 1977 AMC automobiles accounted for 1.8 percent of domestic new car sales in this Central Florida district, 2.6 percent of the sales in the Tarpon Springs area, and 1.7 percent of the sales in the New Port Richey area. In 1982 AMC automobiles accounted for 1.4 percent of the district sales, 1.0 percent of the Tarpon Springs area sales, and 0.9 percent of the New Port Richey area sales. In 1977 Jeep automobiles accounted for 14.1 percent of the four-wheel drive vehicle sales in the Central Florida district, 13.5 percent of the sales in the Tarpon Springs area, and 13.8 percent of the sales in the New Port Richey area. In 1982, Renault vehicles accounted for 1.4 percent of the district sales, 1.0 percent of the Tarpon Springs area sales, and 0.5 percent of the New Port Richey area sales. Thus, while AMC penetration in the Tarpon Springs area is comparable to district penetration (although Tarpon Springs penetration seems to be declining), the penetration in the New Port Richey area is well below the district average. Not only has Burruss spent less on advertising than other dealers, but also it has not maintained a 60-day supply of vehicles based on "planning potential." (A minimum estimated number of sales a dealer should make in a year.) Based on the planning potential for the combined Tarpon Springs and New Port Richey areas, Burruss should stock 14 AMC, 10 Jeep, and 36 Renault vehicles. As of January 31, 1982, Burruss had in stock 8 AMC, 3 Jeep and 17 Renault vehicles. AMC consistently allots Burruss more vehicles than it purchases. AMC has received more complaints directly from customers in the West Pasco service area about the products they purchased, but not necessarily from Burruss, than from other service areas in the same district. This is indicative that insufficient attention is paid to providing warranty services in the area by the franchised dealer. That a separate market area in Pasco County exists and has been recognized by several other automobile manufacturers was admitted by Herman Burruss, the principal stockholder of Burruss Motor Company, who was the chief operations officer for Burruss for some 45 years until approximately five years ago when he turned the job over to his son and retreated into semi retirement.
The Issue The issue presented here concerns the question of whether the Respondent, State of Florida, Department of Highway Safety and Motor Vehicles, Division of Motor Vehicles, should grant the Petitioner, Crown Pontiac, Inc., a motor vehicle dealer license in accordance with Section 320.642, Florida Statutes (1979), on the basis that the Petitioners in this cause, in the face of the challenge to Crown's licensure offered by the Respondent, B & L Motors, Inc., d/b/a Bert Jackson Imports, have proven that the existing Fiat automobile dealers in the proposed territory or community for licensure are providing inadequate representation for Fiat.
Findings Of Fact On May 5, 1980, the Petitioner Fiat Motors of North America, Inc., issued a letter of intent to grant a Fiat franchise to the Petitioner Crown Pontiac, Inc., d/b/a Crown Sportscar Center to sell Fiat automobiles. (See Petitioner Fiat's Exhibit No. 13 admitted into evidence.) The Fiat dealership would be located at the sportscar facility of Petitioner Crown's overall operation which is found at 5301 34th Street North, St. Petersburg, Florida. The Respondent B & L Motors, Inc., d/b/a Bert Jackson Imports, having learned of Fiat's intentions to grant the franchise to Crown, protested Crown's licensure before the Respondent, State of Florida, Department of Highway Safety and Motor Vehicles, Division of Motor Vehicles, that protest having been made in keeping with the terms of Section 320.642, Florida Statutes (1979). 2/ After receiving the Respondent, B & L Motors' Petition in protest, the Division of Motor Vehicles forwarded the case to the State of Florida, Division of Administrative Hearings for hearing pursuant to Section 120.57(1), Florida Statutes. That formal hearing was held on December 4, 1980. PARTIES Petitioner Fiat is an automobile distributor that offers Fiat motorcars for sale in the United States through its several franchise retail outlets. Its model line includes two sedans; the Brava and Strada, and two sports convertibles; the X1-9 and the Spider. The Petitioner Crown Pontiac is a retail outlet for the General Motors, Pontiac automobile, JRT-British Leyland, MG, Triumph, Jaguar and Rover, Peugeot, Nissan, and Honda, through its stores in St. Petersburg, Florida. It is the intention of Crown to sell the Fiat line through the sportscar part of its operation which now handles JRT-British Leyland products. The Respondent B & L Motors, is a retail outlet for Volkswagen automobiles, Fiats and Lancias. That dealership is located in Clearwater, Florida, within Pinellas County, Florida, the county in which St. Petersburg is found. The Respondent, Division of Motor Vehicles is an agency of the State of Florida with regulatory responsibility and authority, among those duties being the requirement to approve or disapprove the application for new motor vehicle dealer licenses in Florida sought by the prospective franchisees of the various automobile manufacturers and distributors. HISTORY OF FIAT DEALERSHIPS IN PINELLAS COUNTY, FLORIDA From 1965 through March 1, 1979, Fiat Motors of North America, Inc., had a licensed franchisee in St. Petersburg, Florida, the last of those Fiat dealers in St. Petersburg being Fifth Avenue Motors, Ltd., d/b/a International Motor Cars Limited. Notice of termination of the franchise of International was sent from Fiat on December 1, 1978, leading to the ultimate cancellation of the Florida license on March 2, 1979. Beginning 1967, Fiat has had a licensed franchise outlet in Clearwater, Florida, with B & L Motors becoming the franchise outlet in Clearwater in late 1974, and continuing to operate as a franchise outlet up through the time of the final hearing in this cause. Subsequent to the loss of the franchise by International and the cancellation of its Florida license on or about March 2, 1979, there has been no Fiat dealership in St. Petersburg, Florida. Crown had attempted to obtain the Fiat franchise by acquiring the Fiat franchise and Mercedes franchise held by Fifth Avenue Motors, Ltd., d/b/a International Motor Cars Limited. This agreement was to be consummated through an asset purchase agreement, a copy of which may be found as Petitioner Crown's Exhibit No. 2 submitted into evidence. This agreement was executed on November 1, 1978, but its terms and conditions were never carried out due to difficulty which Crown had in coming to terms with Mercedes on the purchase of that franchise. At present there is an ongoing law suit on that subject. In addition, vandalism and theft of certain parts that Crown was to purchase from Fifth Avenue has held up the contract. Fiat and Crown had begun their negotiations in October 1978 leading Fiat to make overtures to Crown to offer a franchise in early 1979, which was rejected by Crown at that time for reasons discussed above. There was contact between Crown and Fiat from March 1979 through March of 1980, and sometime in April or May Crown determined to go forward with the franchise agreement, notwithstanding the International dispute. This led to the May 5, 1980, intent to grant by Fiat and the ensuing request by Crown that the State of Florida, Division of Motor Vehicles issue a dealer license. (In connection with the question of a grant of a license to operate a Fiat dealership in St. Petersburg, the Respondent Division of Motor Vehicles had had a past policy of allowing a manufacturer to replace a dealer, within one year of the cancellation of the prior license, without entertaining protests from other competing dealers provided, further, the prior dealer lost its franchise agreement with the manufacturer. In this case, the one year grace commenced on or about March 2, 1979, and expired on or about March 2, 1980. See Joint Exhibit No. 1, affidavit of Henry C. Noxtine.) FIAT'S MARKET SHARE IN THE UNITED STATES, MAJOR MARKETS, PINELLAS COUNTY, ST. PETERSBURG AND CLEARWATER Petitioner Fiat's Exhibits Nos. 1 through 4, admitted into evidence are charts which depict the sale of import automobiles in the United States, with particular emphases on the sale of Fiat automobiles in the United States, Florida, Clearwater and St. Petersburg. Exhibit No. 1 shows the number of import auto sales as a percentage of total automobile sales in the years 1977, 1978, 1979, and the first nine months of 1980, for given market areas. From this chart, it can be seen that import automobile sales range from 17.3 percent through 18.4 percent, in 1977, depending on whether the study related to the United States, Florida, Clearwater or St. Petersburg to 27.6 percent through 28.9 percent for the first nine months of 1980, depending on which of the above referenced market areas was under consideration. Although the trend within the import market for automobiles showed an upturn as a percentage of total sales from 1977, through the first nine months of 1980, Exhibit No. 2 demonstrates that Fiat's percentage of total import sales range from a high United States percentage of 3.2 percent in 1977, to 1.6 percent in September 1980, thereby depicting a decline in overall sales of Fiat automobiles as a percentage of total imports sold in the United States. Of particular significance is the fact that the number of Fiat automobiles sold as a percentage of total imports in St. Petersburg is 2 percent in 1977, and 1.9 percent in 1978, at a time when a separate Fiat dealer was located in St. Petersburg and with the advent of the failure of the St. Petersburg dealership in 1979, the sales were 1.2 percent and in the first nine months of 1980, in which B & L was the sole Pinellas County dealer, those sales were only .5 percent in St. Petersburg. In the successive years, 1977 through the first nine months of 1980, Fiat sales in Clearwater were 2.7 percent, 2.2 percent, 2.7 percent and 1.8 percent, respectively. The figures related to Fiat sales in Clearwater in the years 1979 and 1980 and sales of Fiats in St. Petersburg in those two reporting years show a disparate break out in numbers of sales in Clearwater and St. Petersburg in those reporting years when contrasted with the 1977 and 1978 reporting years, which show the percentage of sales in Clearwater and St. Petersburg to be much closer. There are approximately 800,000 people in Pinellas County, Florida, with approximately 250,000 of those persons residing in St. Petersburg and 350,000 in the overall St. Petersburg area, which is in the southern part of the county. There is another major population center in the northern part of the county. Clearwater is the principle municipality in that area. St. Petersburg and Clearwater constitute separate and identifiable trading areas and territories within Pinellas County, Florida. In this connection, Exhibit No. 3 admitted into evidence shows Fiat's performance in 1979, in similar markets to that of Clearwater or St. Petersburg, outlining the Fiat registrations and the percentage of registrations of Fiat automobiles in those communities. This chart should be read in conjunction with Exhibit No. 4, which is admitted into evidence which shows the number of import sales in the St. Petersburg and Clearwater territories and the number of Fiat sales in those territories, together with the number of Fiat sales necessary to gain the 3.5 percent penetration and the increase in number of units sold to achieve that goal. There is a further hypothetical to demonstrate sales penetration at 5 percent and the number of prospective sales if the goal is achieved. Again, this is for the year 1979. Although the last reporting period, i.e., the first nine months of 1980, shows that the overall Fiat sales nationwide are 1.6 percent and the Florida sales are 2.2 percent, sales in what Fiat has called its "major markets" approximated 2.7 percent in 1979. It is within the "major markets" that Fiat intends to offer its future emphasis and these areas are felt to be crucial to the continued success of Fiat Motors. Sales in Clearwater and St. Petersburg, which are considered "major markets," range from .5 percent in St. Petersburg to 1.8 percent in Clearwater for the reporting period 1980, far below the 2.7 percent or even the national and Florida figures for 1980, when examining performance in St. Petersburg. The balance of Exhibits Nos. 1 through 4 by the Petitioner Fiat, although not discussed in this Recommended Order are found to be factually correct. COMPETITION Within Pinellas County, Volkswagen has two franchise dealers; British Leyland has two franchise dealers; Honda has two franchise dealers; Toyota has three franchise dealers; Dodge has three franchise dealers; Plymouth has three franchise dealers; Subaru has three franchise dealers; and Chevrolet and Ford have four franchise dealer outlets. Again referring to the charts Exhibits Nos. 1 through 4, they would show an increase in percentage of market share by the import automobile industry at a time when the overall numbers of automobile sales have declined, and of those automobile sales in decline, at lease two competitive import product lines, Volkswagen and British Leyland, have been part of the picture of general decline. Nonetheless, they have continued to have two franchises within Pinellas County. EFFECT OF INCREASING FIAT DEALERSHIPS IN PINELLAS COUNTY By increasing the number of Fiat dealerships from one to two, it increases the presence of the Fiat name in the territory by 100 percent. It adds a dealership with proper facilities for furnishing warranty and other repair services, by an organization that has already gained familiarity with the Fiat line; it creates the opportunity for the exchange of vehicles and parts between dealers in the county; it creates the opportunity for the public to engage in comparison shopping and it reduces the amount of time which South County owners must travel to receive factory approved service which now ranges from thirty minutes to an hour if the service is to be obtained from B & L Motors. All of these items relate to the success of Fiat and its franchisees in marketing the Fiat product. In this regard, the statistics offered in this hearing demonstrate that the Respondent B & L has continued to keep pace with Fiat's needs in the market in Clearwater, but it has failed take up the slack that occurred when International lost its franchise. The Petitioner Crown is in a position to assist Fiat in regaining this market share without undue detriment to the Respondent B & L. Crown, in its other automobile sales activities, has primarily concentrated on the southern half of Pinellas County, which is the St. Petersburg area or territory and it would use that experience in the market area in attempting to sell Fiat automobiles to the consuming public.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the application of Crown Pontiac, Inc., d/b/a Crown's Sportscar Center, to be licensed as a Fiat dealer in St. Petersburg, Florida, be GRANTED. DONE AND ENTERED this 13th day of February 1981 in Tallahassee, Florida. CHARLES C. ADAMS Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 13th day of February 1981.
The Issue The issue in the case is whether an application for a new point franchise motor vehicle dealership filed by El Sol Trading, Inc., and Fishers Auction Services, Inc., d/b/a Fisher Auto Equipment Sales (Petitioners), should be approved.
Findings Of Fact There was no evidence presented at the hearing to establish that Respondent has a franchise agreement to sell or service SHEN motor vehicles, the line-make to be sold by Cycles and More, Inc. There was no evidence presented at the hearing that Respondent's dealership is physically located so as to meet the statutory requirements for standing to protest the establishment of the new point franchise motor vehicle dealership.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order dismissing the protest filed in this case by Cycles and More, Inc., and granting Petitioners' request to establish a new point franchise motor vehicle dealership for the sale of SHEN motorcycles. DONE AND ENTERED this 7th day of July, 2010, in Tallahassee, Leon County, Florida. S JAMES H. PETERSON, III Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 7th day of July, 2010. COPIES FURNISHED: Gloria Ma El Sol Trading, Inc., d/b/a Motobravo, Inc. 19877 Quiroz Court City of Industry, California 91789 Raymond L. Fisher Fishers Auction Services, Inc., d/b/a Fisher Auto Equipment Sales 119 Dixwood Avenue Edgewood, Florida 32132 Jeanne Ciriello Cycles & More, Inc. 5797 South Ridgewood Avenue Port Orange, Florida 32127 Carl A. Ford, Director Division of Motor Vehicles Department of Highway Safety and Motor Vehicles Neil Kirkman Building, Room B-439 2900 Apalachee Parkway Tallahassee, Florida 32399-0500 Robin Lotane, General Counsel Department of Highway Safety and Motor Vehicles Neil Kirkman Building 2900 Apalachee Parkway Tallahassee, Florida 32399-0500
