Title 49 › SUBTITLE VI — MOTOR VEHICLE AND DRIVER PROGRAMS › PART A — GENERAL › CHAPTER 301 — MOTOR VEHICLE SAFETY › SUBCHAPTER II — STANDARDS AND COMPLIANCE › § 30116
If a manufacturer or distributor finds a safety defect or a failure to meet safety rules after selling a vehicle or part to a dealer or distributor, but before that dealer sells it to a buyer, the manufacturer or distributor must act right away. They must either buy back the vehicle or part at the price the dealer paid, pay any transport costs, and add at least 1% of that price per month (prorated from the date the defect was reported until repurchase), or they must provide, at their own cost, the part or equipment needed to fix the defect so the vehicle meets the safety rules. The dealer or distributor must install the part. If the dealer installs it promptly, the manufacturer must pay the dealer a fair amount for installation plus at least 1% per month (prorated from the date notice was given until the vehicle is fixed). The parties should agree on these amounts. If they cannot agree, or if the manufacturer refuses to comply, the dealer may sue in a U.S. federal court where the manufacturer or distributor is located, to get damages, court costs, and a reasonable lawyer’s fee. Any lawsuit must be filed within 3 years after the claim begins.
Full Legal Text
Transportation, Source: USLM XML via OLRC
Legislative History
Reference
Citation
49 U.S.C. § 30116
Title 49, Transportation
Last Updated
Sep 22, 2026
Release point: 119-110