§ 1784.31. — 1784.31. (Added by Stats. 2025, Ch. 354, Sec. 1.)

The following definitions apply for purposes of this title:
(a)
“Add-on” or “add-on product or service” means any product or service not provided to the purchaser or lessee or installed on the vehicle by the vehicle manufacturer and for which the dealer, directly or indirectly, charges a purchaser or lessee in connection with a vehicle sale, lease, or financing transaction.
(b)
“Auction” means a sale transaction conducted by means of oral, written, or electronic exchanges whereby offers are solicited from one or more potential purchasers in the form of bids in an effort to advance the amount of the bids to obtain the highest
and most favorable offer.
(c)
“Dealer” means a licensed California motor vehicle dealer or a dealer as defined in Section 285 of the Vehicle Code.
(d)
“GAP agreement” means an agreement for either of the following:
(1)
To indemnify a vehicle purchaser or lessee for the difference between the actual cash value of the vehicle in the event of an unrecovered theft or total loss and the amount owed on the vehicle pursuant to the terms of a loan, lease agreement, or installment sales contract used to purchase or lease the vehicle.
(2)
To waive the unpaid difference between money received from the purchaser’s or lessee’s vehicle insurer and some or all of the
amount owed on the vehicle at the time of the unrecovered theft or total loss, including products or services titled “guaranteed automobile protection agreement,” “guaranteed asset protection agreement,” “GAP insurance,” or “GAP waiver.”
(e)
“Material” or “materially” means likely to affect a person’s choice of, or conduct regarding, goods or services.
(f)
(1)
“Motor vehicle” or “vehicle” means a motor vehicle as defined by Section 415 of the Vehicle Code.
(2)
Notwithstanding paragraph (1), “motor vehicle” or “vehicle” does not include any of the following:
(A)
Vehicles that are sold wholesale. For purposes of this subparagraph, “wholesale”
means sale of a vehicle that does not constitute a retail sale, as defined in Section 6007 of the Revenue and Taxation Code.
(B)
Vehicles that are not required to be registered under the Vehicle Code.
(C)
Fleet sale transactions. For purposes of this subparagraph, “fleet sale” means the sale of more than one vehicle as part of a single transaction for use primarily for business or commercial purposes.
(D)
Sales to commercial purchasers. For the purposes of this subparagraph, “commercial purchasers” means a person that purchases five or more vehicles from the dealer per year for use primarily for business or commercial purposes.
(E)
A vehicle that
has a gross vehicle weight rating of 10,000 pounds or more.
(g)
“Restocking fee” means the following fees that the dealer may charge a buyer or lessee who exercises the three-day right to cancel:
(1)
(A)
One and one-half percent of the sale price of the vehicle, but not less than two hundred dollars ($200) and not more than six hundred dollars ($600).
(B)
In lieu of the fee in subparagraph (A), a dealer that charged the buyer or lessee a shipping fee for transporting
the vehicle may retain the cost the dealer actually incurred for shipping, provided that the amount retained does not exceed the amount that would otherwise be permitted under subparagraph (A). The dealer shall refund to the buyer or lessee the balance, if any, between the amounts charged and retained.
(2)
If the vehicle has been driven over 250 miles, the dealer may also charge the buyer or lessee an additional one dollar ($1) for each mile over 250 miles, but this amount shall not exceed one hundred fifty dollars ($150).
(h)
“Service contract” includes products that provide consumers with some type of benefit or payment for repair, maintenance, or service on the vehicle purchased or leased.
(i)
(1)
“Three-day,” as used in the phrase “three-day right to cancel,” means the period in which a buyer or lessee of a used vehicle may exercise the right to cancel the purchase or lease as provided in Section 1784.43. Except as provided in paragraph (2), this period consists of the three calendar day period commencing the calendar day after the purchase or lease is executed.
(2)
If the third day in the three calendar day period described in paragraph (1) falls on a day the dealership is closed to the public, the three-day right to cancel period extends to the next day the dealership is open to the public.
(3)
The three-day right to cancel ends at the close of business on the last day of the period described in this subdivision.
(j)
(1)
“Total price” means the total sale price of a vehicle, excluding the taxes, fees, and charges described in subdivision (e)
of Section 11713.1 of the Vehicle Code.
(2)
“Total price” includes any dealer price adjustment and the cost of any item installed on the vehicle at the time of the advertisement or communication.
(3)
“Total price” does not include any deduction for a rebate.
(k)
(1)
“Used motor vehicle” or “used vehicle” means a vehicle, as defined by subdivision (f), that also satisfies the definition of a “used vehicle” as defined in Section 665 of the Vehicle Code.
(2)
“Used motor vehicle” does not include a motorcycle, as defined in Section 400 of the Vehicle Code.

Legislative History

Added by Stats. 2025, Ch. 354, Sec. 1. (SB 766) Effective January 1, 2026. Operative October 1, 2026, pursuant to Section 1784.28.