Dear Governor Pritzker,
As we continue to work towards an economic recovery coming out of the pandemic, optimism is growing. Our State and local economies are reopened and expanding once again, recent credit ratings for the state demonstrate a continued march toward fiscal stability, and Illinois was recently ranked as the 15th best state for business. Despite the many challenges that remain, Illinois’ investments in our infrastructure and education systems leave us well-positioned to grow and become a leader in several key industries coming out of the pandemic. Through your recent announcement of Lion Electric coming to Illinois and your Department of Commerce and Economic Opportunity’s 2019 Economic Development Plan, manufacturing, and particularly traditional and electric auto manufacturing, is clearly one of those key industries.
Currently, Illinois ranks ninth in country for auto production. This is a true success story for Illinois, and we should and need to do all we can to support the industry, particularly as EV manufacturers look to Illinois as a growing hub and traditional auto manufacturers invest billions to retool their facilities and transition their fleets toward electric. All this work and investment means high-paying and stable jobs for Illinoisans across our State.
It is against this backdrop that the Chicagoland Chamber of Commerce encourages you to veto HB 3940 of the 102nd General Assembly, which requires auto manufacturers to pay car dealers far more than what is required to repair a vehicle and would make Illinois the most costly and uncompetitive state in the nation for auto manufacturers on warranty-related issues in the country. Auto manufacturers, under this bill, would now have to pay dealers 150% of the estimated repair time. Estimates show that this bill alone would cost manufacturers an additional $249 million per year in warranty repairs. Only Montana and Wisconsin have anything remotely similar to what HB 3940 prescribes for auto manufacturers in Illinois.
Put simply, enacting this bill sends a message to auto manufacturers, who are genuinely interested in investing here, that the regulatory climate and cost of doing business could change on a whim. At a time when companies have more choices than ever on where to invest, this bill will put an “unwelcome sign” out for auto manufacturers and their suppliers and risk thousands of manufacturing and building trades jobs.
Further, HB 3940 does nothing to help mechanics working at the dealerships earn more money despite repeated attempts by the opponents of the bill to insert language to that effect during the spring negotiations. It will also result in higher prices for warranty services for consumers making car ownership a more expensive venture for low-and-middle income families.
Throughout the Spring Session, the manufacturers proposed many alternative solutions including paying dealers for actual time instead of an arbitrary amount of time determined by a “time guide,” as well as compromise language adopted by California in response to a then-Governor Brown veto. Each proposal was rejected by the dealers.
The manufacturers stand ready to work with you and your administration to help find a compromise with the dealers. We hope that unfortunate policy decisions coming from the General Assembly do not inhibit the growth of an industry that is poised to grow and attract billions in investment and create thousands of jobs over the next decade. To that end, we urge you veto HB 3940 and bring both sides back to the negotiating table.
Thank you for your consideration. Please do not hesitate to contact me or my staff should there be further information or input that we can provide.
JACK LAVIN, PRESIDENT & CHIEF EXECUTIVE OFFICER, CHICAGOLAND CHAMBER OF COMMERCE