Dealer-related Information in Alabama

The state of Alabama has made it easy to learn how to process cars as a retailer, wholesaler, rebuilder, or reconditioner. For the basics of becoming a dealer, first review the licensing requirements. The Department of Revenue also offers information that concerns motor vehicle dealers.

Here are some things you should know about car dealerships in Alabama:

• Under Alabama Code Section 40-12-51, if your pawn shop receives certificates of title, you may qualify as a used motor vehicle dealer if the pawn shop repossesses and then sells or negotiates to sell at least five vehicles in one year.

• Sellers of motorcycles, golf carts, mopeds, off-road motorcycles, and ATVs need licenses under Section 40-12-62 of the Alabama Code unless you receive motor vehicles as trade-ins, in which case the motorcycle shop will need the usual regulatory and business licenses required for automobile dealers. A wholesale license is sufficient if the vehicles are sold to licensed dealers. If sales are made to retail customers, you'll need a retail license.

• Your dealer license is not transferable to another county.

• If your dealership moves to a new location in the same county that requires a higher license fee, you must pay the difference. If you move to a new location in the same county that requires a less expensive license, however, there is no refund of the difference.

• If you open a second location in the same city, you can purchase a license for half the price of the first location (you must have a license for each location). If you are outside city limits, you must pay the full price ($45) for each location. The amount for a second location within a city may not be combined with the half year's license after April 1.

Dealer Tags

A licensed car dealer may apply for dealer tags at the courthouse in the county where the business is licensed. Questions about dealer tags should be addressed to the Motor Vehicle Division at (334) 242-9000.

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