Vehicle Industry Registration Procedures Manual

Driver Education illustration

Section 3 of 38

Chapter 2: General Information – Licensees

2.025 Dealer (VC §285)

In general, a vehicle dealer is a person who, on a full-time or part-time basis:

  • For commission, money, or other thing of value, buys or offers for sale, a vehicle subject to registration, or a motorcycle, snowmobile, or all-terrain vehicle subject to identification (ID), or a trailer subject to registration or ID.
  • Is engaged wholly or in part, in the business of selling, buying, or taking in trade vehicles for the purpose of resale, selling, offering for sale, consigned to be sold, or otherwise dealing in vehicles, whether or not such vehicles are owned by the

See VC §286 for exceptions.

A dealer cannot advertise for sale, sell, or purchase for resale any new vehicle of a make for which the dealer does not hold a franchise (VC §11713.1(f)).

Vehicle dealers exclusively involved in the sale of vehicles between licensed dealers are wholesale dealers.

Persons regularly employed by licensed dealers, and persons who sell cars which were purchased and used as personal vehicles are not considered dealers (VC §286).

A vehicle dealer who is authorized to do business as, and has an established place of business in another state, is not subject to licensing requirements in California if:

  • A place of business is not established in this state.
  • The business transacted in California is limited to the importation of vehicles for sale, to, or the exportation of vehicles purchased from, persons licensed in California (VC §11700.1).

Used vehicle dealers and wholesale only dealers must complete a dealer education program, pass a written exam administered by DMV prior to completion of the dealer application, and complete a continuing education program of at least four hours every two years (VC §11704.5).