Dealer asking me to sign Right of First Refusal
11-03-2021, 05:32 AM
#31
Instructor
Thread Starter
11-03-2021, 05:33 AM
#32
Instructor
Thread Starter
11-03-2021, 10:51 AM
#33
Got an email from my SA asking me to sign a Right of First Refusal agreement for my incoming 992 C4S Cab. Basically it's asking me to:
1) Not sell/transfer/lease my vehicle to anyone within the first year.
2) If I am to sell/transfer/lease within the first TWO years, I need to provide notice to the dealer in which they have 72 hours to submit a same or better competing offer that I'd have to accept.
In "return", I will "most likely" get priority allocation for my next Porsche purchase. The SA is saying that this is something Porsche Canada is asking all the dealers in Canada to do due to the worldwide vehicle shortage and the need to protect their inventory.
This all smells incredibly fishy to me and I don't see why I'd need to sign any of this crap at all. And given the fact that I plan to transfer ownership of the vehicle to my dad upon delivery (as his retirement gift), I don't see any reason for me to sign this. Since it's a gift, I have no intention to flip my 992 and use it as speculation on the market. I'm not that desperate for money. What do you guys think?
1) Not sell/transfer/lease my vehicle to anyone within the first year.
2) If I am to sell/transfer/lease within the first TWO years, I need to provide notice to the dealer in which they have 72 hours to submit a same or better competing offer that I'd have to accept.
In "return", I will "most likely" get priority allocation for my next Porsche purchase. The SA is saying that this is something Porsche Canada is asking all the dealers in Canada to do due to the worldwide vehicle shortage and the need to protect their inventory.
This all smells incredibly fishy to me and I don't see why I'd need to sign any of this crap at all. And given the fact that I plan to transfer ownership of the vehicle to my dad upon delivery (as his retirement gift), I don't see any reason for me to sign this. Since it's a gift, I have no intention to flip my 992 and use it as speculation on the market. I'm not that desperate for money. What do you guys think?
11-03-2021, 11:13 AM
#34
unless they agree to pay you back the purchase price in the first year, then it is complete BS.
Could you imagine who badly they would screw you in that first year if you could only sell it or trade it back to them. Unless they are ready to commit to a firm price and not some BS around "value to be determined at the time" then I would tell them a strong no. Even if you have no plans to sell it in the first year, things can happen.
Could you imagine who badly they would screw you in that first year if you could only sell it or trade it back to them. Unless they are ready to commit to a firm price and not some BS around "value to be determined at the time" then I would tell them a strong no. Even if you have no plans to sell it in the first year, things can happen.
11-03-2021, 11:25 AM
#35
Rennlist Member
At the end of the day, it's all in the fine print and as a lawyer, I'd like to actually see what they want someone to sign.
The agreement not to sell is an interesting one and as noted by Bud above, could run afoul of the Competition Act.
The RFR isn't something that I find as offensive, depending on the fine print. If you otherwise have an offer on your car that you are prepared to accept, you are just allowing the dealer to buy it on the same terms. The only issue with RFR's are that they tend to depress the marketability of an asset becuase a bona fide purchaser doesn't want to make an offer on your "asset" when they know someone could swoop in and but at the same price.
If you have am existing contract to buy a car and your dealership wants you to sign this paperwork as a condition to picking up your car, I would definitely tell them to screw off. This should only be something to negotiate when you are signing your contract to purchase the car, not after the fact.
The agreement not to sell is an interesting one and as noted by Bud above, could run afoul of the Competition Act.
The RFR isn't something that I find as offensive, depending on the fine print. If you otherwise have an offer on your car that you are prepared to accept, you are just allowing the dealer to buy it on the same terms. The only issue with RFR's are that they tend to depress the marketability of an asset becuase a bona fide purchaser doesn't want to make an offer on your "asset" when they know someone could swoop in and but at the same price.
If you have am existing contract to buy a car and your dealership wants you to sign this paperwork as a condition to picking up your car, I would definitely tell them to screw off. This should only be something to negotiate when you are signing your contract to purchase the car, not after the fact.
11-03-2021, 11:35 AM
#36
Race Car
If you don't sign it or do sign it and then flip what can they do?
Legal ramifications or just put on the s##t list?
How would they even know if you flipped it?
Legal ramifications or just put on the s##t list?
How would they even know if you flipped it?
11-03-2021, 11:52 AM
#37
Drifting
Have to sign something similar for 1 ton diesel denalis and corvettes. Must drive for 6 months and 12,000km. Not anything about selling it back to the dealer however.
the market is retarded in every sector nearly for flippers and wholesalers.
the market is retarded in every sector nearly for flippers and wholesalers.
11-03-2021, 12:01 PM
#38
I just called my SA, and it's a big deal to the dealership NOW. Porsche Canada has made it clear that if the car gets exported in the first year, they will claw back the dealer profit for that particular car, and the dealership will also lose an allocation the subsequent years! All Porsche Canada has to do is run a check and they can see when the ownership change hands. So you can guarantee that you will be put on the s@#t list for sure! And Porsche Canada will send out the name of customers, and no Porsche dealers are to sell cars to you, and why would they?!
11-03-2021, 12:05 PM
#39
Drifting
What's harder to get? Daytona, Birkin, G Wagon or a new Porsche?
11-03-2021, 12:05 PM
#40
Burning Brakes
11-03-2021, 01:52 PM
#41
Instructor
Thread Starter
If so, what does this mean? I'll never get an allocation for a Porsche again? Talk about first world problems.
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reacp911 (11-03-2021)
11-03-2021, 02:17 PM
#42
We signed something similar when we bought our Macan. We were given the document on the delivery day, months after the order contract. We signed it because we weren't going to flip it or export it.
It can actually be worse than this: We were recently looking at a Land Rover Defender and we were told by a Toronto dealership that if we wanted to pay cash we would have to pay 15% over MSRP as a "deposit" and we would only get the money back 12 months later by showing them that we were still the registered owners of said Defender.
It can actually be worse than this: We were recently looking at a Land Rover Defender and we were told by a Toronto dealership that if we wanted to pay cash we would have to pay 15% over MSRP as a "deposit" and we would only get the money back 12 months later by showing them that we were still the registered owners of said Defender.
11-03-2021, 02:49 PM
#44
My old BMW dealer was very aware of "clients" trying to buy and flip cars. One day I was talking to the owner when a young guys walks in. She immediately called the SA and repeated to him not to sell a car to the guy. She told me that BMW was up their *** about the subject. As 992C4 said, BMW would charge them back the profit they made on the sale. She didn't care what kind of profit they could make, they were not going to sell anything to him!
11-03-2021, 03:03 PM
#45
Team Owner
if you take delivery and then transfer to your father, do you not have to pay tax again ?? or is that allowed without tax to a direct family member ? i know i gifted my car to my son, but didn't know it worked the other way around.
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ibopm (11-03-2021)