679-B Registry No. 1403-42 

NATIONAL RECOVERY ADMINISTRATION 

PR·OPOSED CODE OF FAIR COMPETITION 

FOR THE 

MOTOR VEHICLE RETAILING 

TRADE 

AS REVISED FOR PUBLIC HEARING 

WE DO OUR PART 

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The Code for the Motor Vehicle Retailing Trade 

in its present form merely reflects the proposal of the above-mentioned 

industry, and none of the provisions contained therein are 

to be regarded as having received the approval of 

the National Recovery Administration 

as applying to this industry 

UNITED STATES 

GOVERNMENT PRINTING OFFICE 

WASHIN GTON : 1933 

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For sale by the Superintendent of Documen ts, Washingto n, D.C. Price 5 .:e nL!l 

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SUBMITTED BY 

NATIONAL AUTOMOBILE DEALERS ASSOCIATION 

(II) 
PROPOSED CODE OF FAIR COMPETITION FOR THE MOTOR 

VEHICLE RETAILING TRADE 

1. p RPOSE 

This Code is set up by the National Automobile Dealers Association, for the purpose of increasing employment, establishing fair 

and adequate wages, effecting necessary reduction of hours, improving standards of Labor and eliminating unfair trade practices 

to the end of rehabilitating the automobile retailing and/ or servicing and/ or repairing industry and enabling it to do its part toward 

establishing that balance of industries which is necessary to the 

restoration and maintenance of the highest practical degree of 

public welfare. It is declared purpose of the automobile retailing and/ or servicing and/ or repairing industry to bring, insofar as may be practicable 

the rates of wages paid within the automobile retailing and/ or 

servicing and/ or repairing industry to such levels as are necessary 

for the creation and maintenance of the highest practicable standard 

of living; to restore the income of enterprises within the industry 

to levels which will make possible the payment of such wages and 

avoid further depletion and destruction of capital assets; and from 

time to time to revise the rates of wages in such manner as will currently reflect the equitable adjustment to variations in the cost of 

living. 

2. DEFINITIONS 

vVherever in this Code, or in any proceeding under or in con- nection with this Code, the following words or terms are used, they 

shall be deemed and taken to have the meanings ascribed to them 

as follows: 

The word " dealer" includes, but without limitation, any individual, partnership, association, trust or corporation engaged in 

whole or in part in any phase of the business of motor vehicle 

retailing, and/ or servicing and/ or repairing new and/ or used motor 

vehicle . 

The term " motor vehicle retailing " shall mean any phase of the 

business of retailing and/ or servicing and/ or repairing new motor 

vehicles and the retailing and/or servicing and/or repairing of used 

motor vehicles by dealers who deal in new cars as aforesaid. 

The term " motor vehicles " as used herein means automobiles, 

including passenger cars, trucks, truck tractors, buses, taxicabs, 

hearses, ambulances, and other commercial vehicles, for use on the 

highway, excluding motorcycles, fire apparatus, and tractors other 

than truck tractors. 

Describe association: Incorporated under laws of Illinois, principal office in St. Louis. The term " association " as used herein means 

9961°-33 (1) 
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National Automobile Dealers Association, a trade association, having 

its principal office at No. 1010 Pine Street, St. Louis, Missouri. 

3. EMPLOYMENT REGULATIONS 

A. LABOR CODE 

(1) Employees of the automobile retailing and/or repairing industry shall have the right to organize and bargain collectively 

through representatives of their own choosing, and shall be free from 

the interference, restraint, or coercion of employers of labor, or their 

agents, in the designation of such representatives or in self-organization or in other concerted activities for the purpose of collective 

bargaining or other mutual aid or protection; 

(2) No employee of the automobile retailing and/or servicing 

and/ or repairing industry and no one seeking employment shall be 

required as a condition of employment to join any company union 

or to refrain from joining, organizing, or assisting a labor organization of his own choosing; and 

(3) Employees shall comply with the maximum hours of labor, 

minimum rate of pay, and ot11er conditions of employment, approved 

or prescribed by the President. 

( 4) vVithout in any way attempting to qualify or modify, by interpretation, the foregoing requirements of the National Industrial Recovery Act, employers in this industry may exercise their right to 

select, retain, or advance employees on the basis of individual merit, 

without regard to their niembership or nonmembership in any organization. 

B. WAGES AND HOURS 

(1) No person under 16 years of age shall be employed in motorvehicle retailing provided, however, that where a State law provides 

a higher minimum rate, no person below the age specified by such 

State law shall be employed within that State, except that persons 

under 16 may be employed (but not in manufacturing or mechani-

. cal industries) for not to exceed 3 hours per day and those hours 

between 7 A.M. and 7 P.M. in such work as will not interfere with 

hours of day school. 

(2) No employee ( except outside salesmen and watchmen) shall 

be employed for more than 48 hours in any one week. All places 

of bu iness shall be kept open not less than 52 hours a week, unless 

such hours were le than 52 hours per week before July 1, 1933, and 

in which case such hours shall not be reduced at all. 

(3) The maximum hours fu:ed in the foregoing paragraph (2) 

shall not apply to en1ployees in 'a managerial or executive capacity 

who now receive $25.00 per week or more; to einployees in supervisory capacity or engaged in technical work; to employees engaged 

in emergency repair and maintenance work on automobiles for which, 

due to seasonal climatic conditions, there are in certain localities 

insufficient trained workers available to take care- of consumer demands; in such localities sixty hours shall not be exceeded in any 

one week. It" is under tood, however, that the average in any six 

months' period will not be over 48 hours. 
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( 4) ot to I ay any mployees, except a hereinbelow prm ide~ 

le · than at the rate of 15.00 per week in any city of over 500 000 

population or in the immediate trade area of such city; nor less 

than at the rate of 14.50 per week in any city of between 250,000 

and 500 000 population or in the immediate tra le area of uch city; 

nor le s than at the rate of $14.00 per week in any city of between 

2,500 and 250,000 population, or in the immediate trade area of such 

city· and in town of les than 2 500 population to increa e all wages 

by not less than 20o/c provided that this hall not require wages at 

the rate of in exce s of 12.00 per week. 

Provided, however, that in places where unskilled labor, such as 

wa hers, grea er , porters, or helpers were paid $12.00 or le s per 

week on July 1, 1933 that this class of workers hall be paid not 

Jess than they were being paid on July 1, 1933, but that their hours 

be reduced to 48 per week. 

(5) Full-time outside salesmen, who are unrestricted as to hours 

and receive remuneration on a commission ba i shall be guaranteed a drawing account of not less than $17.50 a week in any city 

of over 500,000 population, or in the in1mediate trade area of such 

city; nor less than at the rate of $15.00 per week in any city between 

250,000 and 500,000 population, or in the immediate trade area of 

such city; nor less than at the rate of $12.50 per week in any city 

between 2 500 and 250,000 population, or in the immediate trade 

area of such city; and in towns of le s than 2,500 population all salesmen shall be guaranteed not less than $10.00 per week. 

An apprentice salesman is excepted from this guaranty until he 

has erved at least six months-three months of which must be 

served with employer last employing him. Such apprentices hall 

be limited to one for each ten regular salesmen, or multiple thereof. 

Population for the purpose of this agreement shall be determined 

by reference to the 1930 Federal census. 

( 6) No mechanic em ployed in this ind us try hall be paid less than 

50 cents per hour unless the hourly rate for the same clas of work 

on July 15, 1929, was less than 50 cents per hour, in which latter case 

such mechanic shall be paid not less than the hourly rate of July 15, 

1929, and in no event less than 30 cents per hour. This paragraph 

establi hes a guaranteed minimum hourly rate of pay regardle~s of 

whether the employee is compensated on the basis of a time-rate 

or a flat-rate performance, or otherwise. 

(7) No dealer shall reduce the compen ation for employment now 

in excess of the minimum wages hereby provided (notwithstanding 

that the hours wor~ed in such employ111ent may be hereby reduced) 

and each dealer shall increase the pay for such employment by an 

equitable readjustment of all pay chedules. 

(8) No dealer shall use any subterfuge to frustrate the spirit and 

intent of this Code which is, among other things, to increa e employment, to remove obstructions to commerce, and to shorten hours 

and to raise wages for the shorter week to a living ba i . 

(9) No dealer shall increa e the price of any merchandise sold 

after the date hereof over the price on July 1, 1933, by more than is 

made necessary by actual increases in wages, or invoice co ts of 

merchandise, or by taxes since July 1, 1933, and in setting such price 

increases, each dealer shall give full weight to probable increases in 
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sales volume and to refrain from taking profiteering advantage of 

the consuming public. 

(10) The maximum. hours herein above provided mark the total 

number of hours which may be worked by any e1npl-oyee; whether 

he works for one or 1nore employers; provided, however, that if any 

employee works more than such maximum without the knowledge 

or connivance of any one of his employers such employer shall not be 

deemed to have violated this paragraph. 

(11) No employee shall be classified in any of the excepted classes 

hereinabove, provided unle s such .employee rJerforms duties identical with those performed by employees thus classified on June 

16, 1933. 

4. INDUSTRY REGULATIONS 

A. USED CAR ALLOWANCE 

To prevent sales below cost, heretofore due to unfair competition 

that has resulted in the dissipation of the large part of the capit.al 

originally in this industry and has accumulated large losses sinoe 

1926, this industry agrees to regulate itself so as to return })ro£t 

possibilities and support increased wages and shortened hours. 

Giving consideration to the public interest and to prevent sales 

below cost, it is hereby provided : 

(1) That the value of any used Jnotor vehicle, eith.er passenger or 

commercial, shall be the average price that the public in any given 

market area is then paying for sueh vehicle, as ascertained by National Aut0111obile Deal-ers' .Association from certified reports of 

actual sales, subject to the approval of the Administrator. The 

Association shall publish the average prices thus ascertained approximately ev-ery 60 days. 

(2) That no dealer shall, directly or indirectly, or by subterfuge, 

accept in trade any used vehicle at an allowance price of n10re than 

its value as determined in paragraph (1) above, less a minimum 

selling, handlino-, and reconditioning charge of 20% . 

(3) To provide a record for the establishment of used-c-ar allowances in paragraph ( 1) above, there shall be provided in each logical 

trading area of the United States an official guide which shall be 

provided by the N.A.D.A. and such other organizations as shall be 

found desirable and shall be known as the N.A.D.A. Official Guide 

and shall be recognized as the authority for such allowances and 

which shall be based upon actual sales in ea.ch trading area f-0r the 

pre·eeding 60-day period. . 

( 4) There shall be used as l.l. basis of establishing allowance vahrns, 

as provided in paragraphs 1 and. 3, the princip1e of averaging a<:tual 

s.ales for th~ preceding period. Since this will, in isolated instances, 

by reason o:f very 'few or no sales ori particular models, leave a need 

to establi ·h a O'Uide figure on such models, the following m~thod of 

determining the allowance values will be pursued for the public 

protection. · 

If -any model car describf'd in th.e Official Guide shows five or 

more sales within th-e district in -any period, then the .average. figure 

published becomes the basis for determining allowances for tlie ensuing period. 
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If any model car has les than five ales within the di trict for the 

period then the new-car dealer handling this particular mak car 

within this district shall e tabli h it allowance value; same to be so 

publi hed in the re1 ort. The e figure to be subject to approval of 

the National Control Committee and the Adm.ini trator. 

If any make car is not represented in the di trict or is no longer 

manufacttll'ed and les than five ale are reported on each or any 

model of such car, then the ational Control Committee subject to 

the approval of the Administrator, will set the figure based on what 

like model of other makes bring in the District. 

B. MARKETING RULES 

The following Marketing Rules hall take effect 30 days after the 

approval by the President: 

( 1) No dealer shall sell a new car for less than factory list prices, 

plu extra for equipment at listed prices, an amount equivalent to 

rail transportation and handling charge to point of delivery, plus 

all taxes paid by said dealer. 

The only exceptions to the e prices shall be sales to proprietors' 

inunediate familie , or members of his organization when for the 

personal use of such buyer. :Motor vehicles old to employees for 

u " in their employers busine s as demon trators or executives' cars, 

and car u ed a demonstrators by dealers, mu t be so regi tered with 

their trade a ociation, or with the State Advi ory Com.mittee; demonstrator and executive cars hall not be sold to a consumer at retail for les · than the full retail price except \\ hen they have been 

in u e for a period of at least. 60 days from the date of registration 

a afore aid and haYe had at lea t 3,500 miles actual road usage, 

or when the manufacturer has made public announcement of a 

change in model. 

(2) To dealer or representative shall offer or give any gratuity, 

commi sion ervice or acce ory for the purpose of inducing a 

customer to purchase a car. Nothing herein hall prevent conduct 

pursuant to any warrant3 or declared policy of the manufacturer. 

( 3) Charges for financing retail sales }~all be upon an equitable 

basi to con umer -tlealer and financing company. A dealer handlinO' his own paper on 1nonthly payment ha is shall not charge a 

lower or higher rate than that charged by regularly established 

finance companies doing a national busine s. 

(4) ,vith the approval of the State Advisory Committee and the 

manufacturer concerned, and for a given reasonable time a deale1· 

will be permitted to ell and offer for sale new cars that have been 

discontinued or about to be di continued at le s than delivered prices 

as de cribed in the fir t paragraph in this section. The intent of this 

provision is to enable dealer to clean up their own or their factories' stock before or after new model announcBment. In the event 

that approval is refu ed by the said Committee or the manufacturer, 

said dealer shall have right of appeal, to the Administrator, who 

may permit such sale. ·. 

( 5) It shall be unfair trade practice for any new car dealer or 

representative to sell or permit to be sold any new motor vehicle 

for resale in a territory already enfranchised for that make of motor 
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vehicle except through the regularly enfranchised dealer in that 

territory and it shall also be an unfair trade practice for any dealer 

to purchase a vehicle as above prohibited. 

( 6) The retail list price for parts, accessories, and supplies shall 

be the manufacturers' published list price adjusted to include all 

taxes. It shall be an unfair trade practice for any dealer to sell 

such parts, accessories and supplies at other than retail list price 

except to duly authorized dealers, associate or sub-dealers, or authorized service stations operating under any N .R.A. Code. 

C. TRADE PRACTICE RULES 

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Emergency National Committee shall hold a trade practice conference as often as may be necessary for the purpose of making 

recommendations to the Adm.inistrator in regard to the establishment and amending of rules of fair trade practice for the Ind~stry. 

5. DISTRICTS OF THE INDUSTRY 

(A) For the purpose of the administration of this code, ·there 

shall be in each state an advisory committee consisting of not less 

than five elected by the dealers of such state, in convention or by 

mail vote. The chairman of each State Advisory Committee shall 

be a member of the Emergency National Committee. The Vice 

Chairman of each State Advisory Committee shall be an alternate 

member of the Emergency National Committee. 

Each such State Advisory Committee shall constitute the fair, 

practical, and planning agency to cooperate with the Administrator 

in respect to problems relating exclusively to the said state. Proposals in respect to matters affecting more than one state may be 

initiated by any State Advisory Committee and shall be submitted 

for consideration to the Emergency National Committee of the 

motor vehicle retailing and/or servicing and/or repairing industry, 

hereinafter described and its determination, subject to the approval 

of the Administrator, shall be binding upon said state and all other 

states affected thereby. It shall be subject to the final appeal to the 

Administrator. For the purpose of the administration of this Code 

the District of Columbia, l\1etropolitan New York, and the rest of 

New York, and Metropolitan Chicago, and the rest of Illinois, shall 

each be considered one state. 

States may be divided or rearranged upon application of any association or group of associations subject to the approval of the Em.ergency National Committee hereinaf~r described. 

B. EXECUTIVE COM:!.\-IITTEES 

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· Each of the present component associations making up each State 

Group and any others which may subsequently be formed within 

the Motor Vehicle Retailing and/or Servicing or Repairing Industry, shall set up Executive Committees for the purpose of assisting 

in administration of the provisions of the Code, to secure adherence 

thereto, to hear and adjust complaints, to consider proposals for 

amendments thereof and exceptions thereto, and otherwise to carry 
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out within the component associations by cooperation through the 

State Advisory Committee the purposes of the National Indu~trial 

Recovery Act as set forth in this Code, subject to final appeal to the 

Administrator, provided that no inequitable restrictions upon member hip in any such as ociation shall at any time be imposed. 

6. EMERGENCY NATION AL COMMITTEE 

.A.. REPRESE T TION 

There shall be an Emergency National Committee of the motor 

vehicle retailing and/ or servicing and/ or repairing industry to consist of one representative by each State Advisory Conunittee. 

B. POWERS 

The Emergency National Committee shall be the general planning 

and coordinating agency for the industry. Its 1nembers selected 

as aforesaid shall be empowered to act for their respective State 

Advisory Committees conclusively in respect to all matters before 

the National Committee for consideration and within its jurisdiction. 

The Chairman of thB Emergency National Committee shall appoint 

eleven members, to be called the Administrative Committee. 

Such appointments are to be approved by a majority of the members of the Emergency National Committee and to insure balanced 

representation of all classes of dealers mu t include dealers from 

smaller towns, a majority of whom shall be retail dealers and dealers 

geographically representative of the nation as well as the various 

lines of cars and with consideration of the appointees availability 

and willingness to serve. 

The Emergency National Committee shall delegate its power to 

the maller body to be exercised as necessary to problems requiring 

attention between meetings of the National body. 

The Emergency National Committee shall have powers and duties 

as provided herein, and in addition thereto it shall-

( 1) from time to time require such reports from state associations 

and component as ociations, or from local associations, or from individu~l dealer , as in its judgment, subject to the approval of the 

Admini trator, may be necessary to advi e it adequately of the 

admini tration and enforcement of the provi ions of this code; 

(2) upon complaint of interested parties or upon its own initiative make such inquiry and investigation into the operation of the 

code as may be necessary, and report its findings to the Administrator; and 

(3) make rules and regulations necessary for financing the admini tration and enforcement of thi code ubject to the approval of 

the Administrator. The Committee may delegate any of its authority to the National Control Committee hereinafter provided and 

may designate such agents as it shall determine. 

7. STATISTICS 

The National Automobile Dealer Association will serve as a 

medium through which all required statistics will be obtained, and 
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each dealer agrees, upon request, to furnish it with such informa. 

tion and make his books available to the National Automobile Dealers Association, to the end that the terms of this code regarding 

increase of wages, shortening of hours, and the establishment of 

fair used-car allowance, based upon actual sales and the maintenance 

of established prices, may constantly be availble to the government. 

8. NATION AL CONTROL COMMITTEE 

The Emergency National Committee of the motor-vehicle retailing 

and/ or servicing and/ or repairing industry shall appoint from its 

own membership a National Control Committee of three members. 

In addition, there may be two nonvoting members appointed by the 

Administrator. The National Control Committee shall exercise such 

authority as may have been delegated to it-by the said Emergency 

National Committee. 

All communications and conferences of the Automobile Reta1ling 

and/ or servicing and/ or repairing Industry with the President or 

with his agents concerning the approval or amendment of this Code 

or of any of its provisions or any matters relating thereto, shall 

be through the said National Control Committee. The N a.tional 

Control Committee shall serve as an executive agency for the Emergency National Committee of the motor-vehicle retailing and/or 

servicing and/ or repairing industry, and shall be charged with the 

execution of the duties, through agents or otherwise, of hearing and 

adjusting complaints, considering proposals for amendments and 

making recommendations thereon, approving recommendations for 

exceptions to the provisions of this code, and otherwise administering 

its provisions. Any member of this Industry shall have the right of 

appeal to the Emergency National Committee from decisions of the 

National Control Committee and the decisions of the said Emergency 

National Committee may be appealed from, to the Administrator. 

The function of this Committee shall be the general planning and 

coordinating for the motor-vehicle retail and/ or servicing and/ or 

repairing industry and the cooperation with similar boards of the 

Automobile Manufacturers Chamber of Commerce and other 

branches of the industry to the end of effecting a balanced national 

economy. 

9. GENERAL 

(1) No provision in this Code shall be interpreted or applied 1n 

such a manner as to: 

Promote monopolies, 1 

Permit or encourage \mfair competition, 

Eliminate or oppress enterprises, or 

Discriminate against small enterpri es. 

(2) This Code is hereby expressly made subject to the right of the 

President, pursuant to Section 10 (b) of the National Industrial 

Recovery Act, from time to time, to cancel or modify any order, approval, J.icense, rule, or regulation issued under Title I of said Act, 

and particularly, but without limitation, to cancel or modify his 

approval of this Code or any condition imposed by him upon such 

approval. 
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(3) The Emergency National Committee of the motor-vehicle retailing and/ or ervicing an ljor repairing indu try and the T ational 

Control Committee shall from time to time make to the Administrator such recommendation , including amendments of the code, as in 

their judgment "ill aid the effectiYe admini tration of this code, or 

may be nece ary to effectuate within the automobile retailing 

and/ or ervicing and/ or repairing indu try or within any state 

thereof the purpo e of the ational Indu trial Recovery Act as 

admini tered. 

( 4) Such of the provi ions of this Code a a re not required to be 

included therein by the National Inclu trial Recovery ct, may, with 

the approval of the Pre ident, be modified or eliminated as changes 

in circum tances or experience may in licate. It is contemplated that 

from time to time supplementary provi ions to thi Code or codes, 

including in particular, but without limitations, supplementary provisions relating to dealers engaged exclusively in the ale and repafring used cars and persons engaged e:xclu ively in servicing or repairing, will be ubmitted for the approval of the Pre ident to prevent 

nnfair competition in price and other unfair and de tructive competitive practices and to effectuate the other purpo e and policies of 

Title I of the National Industrial Recovery Act consi tent with the 

provisions thereof. 

( 5) Violation by any dealer of automobile retailing and/ or sen icing and/or repairing industry or any provi ions of this code, or of 

any approved rule issued thereunder, is an unfair method of 

competition. 

(6) If any employer in this industry is also an employer in any 

other industry, the provisions of this code shall apply to and affect 

only that part of the busine s of such employer which is a part of 

the industry covered by this code. 

(7) This code shall become effective upon its approval by the 

President, except as herein pecifically provided. 

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UNIVERSITY OF FLORIDA 

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