This is a summary of information regarding the requirements to obtain Alabama dealer licenses and dealer license plates. Information presented contains all changes in Act 2019-244 effective October 1, 2020.
Applications for an Alabama dealer regulatory license must be submitted to the department electronically. To apply: Visit the Motor Vehicle License Portal . Upon submission of the license application, a transmittal sheet will be provided that lists which documents must be mailed to the department.
All new and used motor vehicle dealers, including motorcycle and trailer dealers (excluding trailers not subject to titling), wholesale dealers and rebuilders.
(Off-site sales licenses must be purchased at least 10 calendar days prior to sale. Visit the Motor Vehicle License Portal to apply for an off-site license.)
A facilitator of an off-site sale is required to obtain a master off-site sales license. The facilitator will be required to verify the off-site license of participating dealers. The facilitator must list each participating dealer’s off-site sale license number on the application. If the dealer and facilitator are the same entity, only the master off-site sales event license is required.
All licensees are required to submit to the department a continuous bond in the amount of $50,000.
All dealers are required by law to become designated agents of the department. The dealer bond also satisfies the designated agent bonding requirement.
Each dealer must maintain blanket liability insurance coverage for all vehicles owned or associated with the business. Minimum insurance limits are:
After the dealer regulatory license has been obtained, the dealer must visit the county licensing office to purchase the appropriate privilege license(s) (Sections 40-12-51, 40-12-62, or 40-12-169). Dealer plates will be issued by the Department of Revenue, contingent upon proof of the appropriate privilege licenses. Dealer plates may be requested in the Motor Vehicle License portal.
Dealer (D) and motorcycle dealer plates may be obtained by licensed motor vehicle dealers. Manufacturer plates may be obtained by manufacturers of private passenger automobiles, motorcycles, trucks, truck tractors, or trailers, if the manufacturing facility is located in Alabama.
Dealer (D) and motorcycle dealer plate restrictions:
There are no limitations on the number of manufacturer and motorcycle manufacturer plates that can be purchased by manufacturers.
These fees cannot be refunded or prorated.
Are there limitations on the types of vehicles the plates may be used upon?
If the dealer charges customers a fee for the uses above, dealer plates cannot be displayed on the vehicle.
Motor Vehicle dealers may display standard plates on vehicles in a dealer’s inventory. Ad valorem tax is not due when this occurs.
If the dealer license is revoked or forfeited, all dealer plates shall be returned to the Department within 10 calendar days.
If a dealer or manufacturer license plate is lost or stolen, this fact must be reported to law enforcement and a report maintained for audit purposes.
If a plate becomes mutilated to the point that it is illegible, the plate must be returned to the Department, and a replacement plate will be issued upon payment of the appropriate fee (Section 40-12-265, Code of Alabama 1975).
When a motor vehicle is withdrawn from inventory, the licensed dealer shall purchase an Alabama license plate and register the vehicle.
Motor vehicle dealer, motorcycle dealer, and manufacturer license plates may not be used in lieu of regular issued license plates as a means of avoiding registration and ad valorem tax requirements.
For more details, please see Sections 40-12-390 through 40-12-400 and 40-12-264, Code of Alabama 1975.