Buys and sells new vehicles under a franchise agreement or contract with the manufacturer of the new vehicle.
Class B – Used vehicle dealer
Buys and sells used vehicles.
Class C – Used vehicle parts dealer
Acquires late model major component parts for resale, either at wholesale or at retail. The dealer may also acquire whole vehicles to dismantle for the resale of parts, selling the remainder as scrap.
Class D – Broker
For compensation, brings a buyer and seller together, negotiates the terms of a transaction, or displays a vehicle offered for sale. In the broker's role regarding the sale, purchase, lease or exchange of vehicles or salvageable parts, the broker does not have title or other legal interest in the vehicle or salvageable part.
A person who conducts a vehicle auction is a type of broker and requires a Class D license.
Class E – Distressed vehicle transporter
Buys, transports, and sells vehicles only to a Class C Used Vehicle Parts Dealer; Class F Scrap Metal Processor; or Class R Automotive Recycler.
Class F – Vehicle scrap metal processor
Processes vehicles into scrap metal by shredding, shearing, fragmenting, baling, or similar means.
Crushing is not considered a scrap metal process since it is not the final step before remelting.
Class G – Vehicle salvage pool
Stores and displays damaged or distressed vehicles for insurance companies.
Class H – Foreign salvage vehicle dealer
Licensed in another state and is in the business of purchasing, selling, or otherwise dealing on a wholesale basis in salvageable parts or late model distressed vehicles in Michigan. This dealer buys or otherwise acquires late model major component parts for resale, either at wholesale or at retail. The dealer may also acquire whole vehicles to dismantle for the resale of parts, selling the remainder as scrap.
Class R – Automotive recycler
Buys or otherwise acquires late model major component parts for resale, either at wholesale or at retail. The dealer may also acquire whole vehicles to dismantle for the resale of parts, selling the remainder as scrap.
Class W – Wholesaler
Buys and sells used vehicles from and to licensed vehicle dealers. Wholesalers may not buy, sell, or otherwise deal in vehicles to a person other than a licensed vehicle dealer.
Only a Salvage Vehicle Agent may buy salvage or scrap titled vehicles at an auction. Class C and Class R dealers will also need to have the Salvage Vehicle Agent license.
Per state law, you must have a dealer license, if within a 12-month period you have been in business:
All dealers must complete and submit a vehicle dealer license application. Based on the class of license they are obtaining; they may need to include the following:
The Michigan Vehicle Code requires that any person, partnership, or corporation conducting business as a vehicle dealer of any type in this state must be licensed by the Michigan Department of State. The Business Compliance and Regulation Division is responsible for overseeing the licensing and regulating of vehicle dealers and has the authority to deny, suspend, or revoke a license or certification if the licensee or applicant has not complied with state law. Dealers may receive a written warning, be placed on probation, be fined, or have their license suspended or revoked if the actions cannot be resolved.
All administrative actions are reported through e-Services under the Search Dealer option.
To close your dealer business, surrender your dealer license by completing the following steps:
To renew your dealer license online, you will need:
Note: You are required to apply for a new license if you allow your license to lapse for more than 30 days [MCL 257.248(8)(h)]. Dealers who have not renewed their licenses cannot operate. Secretary of State offices will not accept transactions from dealers whose licenses have expired.
You can correct or change your license name or address at the time of renewing your dealer license or by completing a Vehicle Dealer License Change of Name and/or Change of Address Application.
Mail the completed application to:
Michigan Department of State
Business Licensing Section
Lansing, MI, 48918
Class A and Class B dealers are required by law to purchase a minimum of two dealer plates.
Eligibility for additional dealer plates is determined using the following formula:
Class W dealers may purchase dealer plates, however, there is not a minimum number required. The maximum number of dealer plates for a wholesale vehicle dealer is initially one plate.
A Class W dealer may apply for additional dealer plate(s). A wholesale dealer will be required to submit copies of title and police book information for vehicles in their inventory to verify the need for any additional dealer plates.
If the request for additional plates is approved, the following formula will be used:
Registration is not issued for dealer plates, only the plate. However, you must keep a copy of the certificate of fleet insurance for any and all dealer-owned vehicles in the vehicle at all times.
To provide documentation of ownership of a vehicle, it is recommended that you keep the following documents with you while operating the vehicle:
To provide documentation of eligible use of the dealer plate, it is recommended that you keep the following documents on your person or in the vehicle:
When a customer has purchased a vehicle and is driving on a dealer plate for 72 hours, a signed and dated copy of the RD-108 showing the new owner's name and address should be provided, as well as a certificate of Michigan No-Fault insurance for the vehicle.
Authorized use of a dealer plate includes, but is not limited to:
Dealer plates cannot be used for:
An auctioneer/in-transit repair plate may be issued to an individual, partnership, corporation, or association, including vehicle dealers, who, in the ordinary course of business, have occasion to legally pick up or deliver a vehicle.
Plates may be obtained by application at a Secretary of State office for $20 per plate. The plate expires annually on March 31 and may be renewed at a Secretary of State office for $5.
The auctioneer/in-transit repair plate may be used to move a vehicle for repair or service, or to pick up or deliver a commercial vehicle being driven to a facility to undergo aftermarket modification. The in-transit repair plate is placed on the vehicle being picked up or delivered.
Watercraft dealers and marinas can use an in-transit repair plate to:
An auctioneer/in-transit repair plate may also be issued to an individual, partnership, corporation, or association who, in the ordinary course of business, operates an auto auction. The plate may be used to legally pick up or deliver a vehicle offered for sale at the auction. Vehicle brokers who are not auctioneers are not eligible for the auctioneer/in-transit repair plate.
Improper use of a dealer plate may result in either:
A vehicle may not be sold or offered for sale in Michigan unless the dealer has a properly assigned title or other ownership document.
Section 235 of the Michigan Vehicle Code (MCL 257.235) requires every vehicle in a dealer's possession (i.e., for resale purposes) to have a document proving ownership.
The only exception to the document possession requirement is for a new vehicle which has an electronic (paperless) Manufacturer's Certificate of Origin (MCO). However, the dealer should have an invoice or other paper document on file. Brokers and auctions should use the Broker Fee Agreement to show authorization to hold the vehicle.
If all assignment spaces on the title are already filled, the selling dealer must apply for a resale title before completing the sale. No tax is due on resale titles.
Vehicle ownership is transferred when the owner(s) signs off of the vehicle title (assigning the title) to the new owner, and the new owner signs on and takes delivery. All owners whose names are shown on the face of the title must sign the title.
Unless the vehicle is exempt from odometer disclosure requirements, the seller must complete the odometer statement on the title before the sale can be finalized.
When selling a vehicle to a non-dealer, the selling dealer must apply for title and registration on the purchaser's behalf within 21 days of delivering the vehicle, using the Michigan Application for Title and Registration (RD-108).
A transaction receipt, form RD-108L, will be generated by the Secretary of State office when the transaction is processed. The requirements for completing the form are outlined in Chapter 7 of the Dealer Manual.
When a vehicle is transferred from one dealer to another dealer, a Michigan Application for Title and Registration (RD-108) is not required if the purchasing dealer is buying the vehicle for resale. The selling dealer simply assigns the title or MCO to the purchasing dealer, and completes the odometer disclosure and separate salvage disclosure, if applicable. All assignments must be dated.
Dealers must give every purchaser a copy of every document signed by the purchaser, at the time of signing, including a Michigan Application for Title and Registration (RD-108) and the front and back of the title. The dealer must complete the reassignment and show the purchaser the title (front and back), and any reassignment forms, before delivery.
Any time a vehicle leaves a dealer's lot on a dealer plate, for law enforcement purposes, it is recommended the following should be in the vehicle:
Vehicle registration fees are determined by state law and are based on the manufacturer's suggested retail price (MSRP) for the vehicle type and model year (1984-present) before any options or taxes are added. Additional license plate, Recreation Passport, and plate personalization fees apply.
Dealer training covers the basic requirements of the Michigan Vehicle Code, dealer functions, licensing requirements, and Secretary of State e-Services. All licensed vehicle dealers and staff may attend training virtually through Microsoft Teams at no cost.
Pre-registration is required.
To sign up for pre-licensing vehicle dealer training, contact the Business Regulation Section at BLRD@Michigan.gov. Include the following information in your request:
State law mandates that original Class B dealers designate an individual to attend dealer training within 90 days of the issue date of the dealer license. Furthermore, state law requires that Class B dealers must have a designated individual attend continuous education dealer training once every 24 months thereafter. Dealers may register for dealer training through e-Services.
All trainings are held virtually on Microsoft Teams.
9 a.m. - 12 p.m. (Noon)
Some automotive-related businesses can process their vehicle transactions through the Michigan Electronic Filing System (MiEFS) program. The MiEFS program works with a vendor which provides PC-based software at the business's location.
Access the following services through e-Services Dealer Services, located under the Business Services section.
Under the "Payments and Fees" section:
Calculate plate fees: Michigan law [Michigan Vehicle Code (MCL 257.217(4)] requires dealers to apply for title and registration on behalf of their customers. When a customer needs a new plate, the dealer must calculate the plate fee and record this information on the RD-108, Application for Michigan Title - Statement of Vehicle Sale. Calculating registration fees on e-Services will minimize plate fee errors, ensuring quicker turn-around time.
Under the "Additional Services" section:
To calculate fees, log onto your e-Services account and complete the following steps:
Search for certified salvage vehicle inspectors; Select a county from the dropdown or select "Search for all" to view a list of active salvage vehicle inspectors in your desired area.
The Friend of the Court (FOC) Lien Search allows dealers and others to determine if a vehicle brought in for trade or sale has an active lien from the Friend of the Court for the owner's failure to make child support payments. Dealers should take appropriate precautions to protect their interest in the vehicle in addition to checking the database.
The Friend of the Court can be added as a secured party on the title for the vehicle. MDOS mails a new title displaying the FOC lien to the vehicle owner with a return envelope requesting the return of the older title; however, owners may not comply and the previous title without the lien will still be in the customer's possession. To use the lien search function, select the "Friend of the Court lien search" button. Once our e-Services web page has loaded, go to the "Vehicle Searches" section and select "Search for Liens and Brands."
The license expiration date is found at the top of your dealer license renewal. The Michigan Vehicle Code requires a new dealer application after a dealer license has been expired more than 30 days.
Who can use a dealer plate?The relevant law is Section 244(4) of the Michigan Vehicle Code. MCL 257.244(4). It states that a dealer may use a dealer plate and specifically defines “dealer” to include three types of individuals, beyond the dealers themselves, who may use a dealer plate: “employee, servant, or agent” of the dealer.
Since the Michigan Vehicle Code does not define “employee, servant, or agent,” a dictionary definition is reasonable. An “employee” is someone who is employed by the dealer for wages or salary; an “agent” is someone who acts on behalf of a dealer; and a “servant” is someone who performs duties for the dealer.
“Family member” is not included in the list of individuals who may use a dealer plate. The mere fact of being a dealer’s family member is not enough to use a dealer plate. However, if a dealer’s family member is an employee, servant, or agent of the dealer, that person would be allowed to use a dealer plate. This is not a new law. This clarification is simply offered as a reminder of what the law is and has been for a long time.
With respect to how a dealer plate may be used—that is, what is an appropriate use for a dealer plate—the relevant law is Section 244 of the Michigan Vehicle Code. MCL 257.244. Dealer plates may be used on dealer-owned vehicles driven by employees, servants, or agents of the dealership for any purpose, provided that the vehicle is not a “service vehicle.” The Michigan Vehicle Code does not define “service vehicle” but a common understanding would include courtesy cars, loaners, daily rental, lease, vehicles used for obtaining or delivering parts, and vehicles used to provide roadside service or tow disabled vehicles.
How do vehicle dealers report a lost, mutilated, or stolen dealer plate?Dealers are reminded to monitor dealer plate use and periodically audit dealer plates to ensure that none have been lost or stolen. Lost, mutilated or stolen plates can be replaced by completing an Application for Additional/Replacement Dealer Plates (AR-0036). Dealer plates confiscated for improper use by law enforcement will not be replaced.
Who can sign up for dealer training?Dealer training is conducted via Microsoft Teams for all dealers. Pre-registration is required.
