Michigan Shuts Down LaFontaine GM for Selling Used Cars as New
URGENT UPDATE: Michigan regulators have swiftly shut down the LaFontaine Chevrolet Buick GMC dealership in St. Clair, alleging the dealership sold used vehicles as new. This marks the second suspension for the LaFontaine Automotive Group concerning similar violations.
The Michigan Department of State confirmed that the dealership sold loaner vehicles with up to 6,000 miles as if they were brand new, a serious breach of state law. Under Michigan regulations, any loaner vehicle that has been titled and registered must be classified and sold as used.
LaFontaine spokesperson Max Muncey has labeled the issue a mere “clerical error,” asserting that the company is working closely with state officials to rectify the situation. “We immediately began reviewing internal processes to ensure full compliance moving forward,” Muncey stated.
The dealership’s license will remain suspended until it can reach an agreement with state regulators, according to Cheri Hardmon of the Michigan Department of State. This crackdown comes as regulators were monitoring compliance under a 2024 agreement after LaFontaine’s Livonia dealership was temporarily shut down in December 2024 for similar misrepresentation.
During that incident, LaFontaine Hyundai of Livonia faced a $25,000 financial penalty and was put on a 24-month probation. Additionally, the Livonia dealership was mandated to participate in training for its management and staff, along with unannounced inspections by regulatory personnel.
Regulators have reiterated the definitions of what constitutes a used vehicle under the Michigan Vehicle Code, aiming to clarify compliance for dealerships. Muncey argues that Michigan’s vehicle titling laws conflict with automaker guidelines, which allow dealer loaner vehicles to be sold as new under certain conditions.
“Michigan’s outdated titling laws still require such vehicles to be classified as used, despite meeting qualifications for new vehicle incentives and warranties,” Muncey explained.
The impact on consumers could be significant, as the misclassification can affect warranty eligibility and pricing. Despite the allegations, Muncey insists that consumers continue to benefit from lower-priced vehicles that remain eligible for new-vehicle incentives.
The Michigan Automobile Dealers Association, represented by James Fackler, has been advocating for changes to the law that would allow loaner vehicles to be sold as new if they fall under a specific mileage threshold. Fackler noted that automakers incentivize dealers to offer loaners during service periods, complicating the regulatory landscape.
As this situation develops, LaFontaine Automotive Group faces mounting scrutiny over its practices. The suspension of LaFontaine Chevrolet Buick GMC raises critical questions about consumer protection in the automotive market and the need for regulatory reform in Michigan.
Stay tuned for updates as authorities continue to investigate and consumers await further clarification on their vehicle purchases.
