Does a forklift dealer’s manufacturer agreement transfer when the business is sold?

A forklift dealer often owes much of its business to the manufacturer’s name on the building. The right to sell and service new trucks under that name comes from a dealer agreement, and the manufacturer chose that dealer. When the owner sells, the manufacturer may have a say in who comes next, so ask the lawyer how the agreement treats a change of owner.

Read the agreement first

Ask the seller for the current agreement and any amendments. Look for how long it runs, how it ends, what it says about a change of ownership and whether the manufacturer can end it without cause. Do not rely on the seller’s summary of it. Your lawyer can explain how the clauses work together and what the document permits.

Territory, sales and service obligations

Dealer agreements often define a territory and set expectations for sales activity, trained technicians, parts stocking and facilities. Ask whether the dealer meets them today. A business that has fallen behind may face questions from the manufacturer when ownership changes. Our page on what to check before buying an equipment rental business covers the fleet side.

Floor-plan lines tied to the brand

Dealers often finance new trucks through a floor-plan line connected to the manufacturer or its lender. Ask who provides it, what happens to it in a sale and whether the lender will deal with a new owner. A buyer who plans their own financing should ask the lender what it needs, since the lender sets its own terms.

Sequence the conversations

Speak to the manufacturer with the seller’s permission and before the purchase agreement becomes final. Ask your lawyer whether manufacturer approval should be a condition of closing, and what happens if it is refused.