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A dispute over adding a new Volkswagen dealership in the Inland Empire market of southwestern California creates an acid test over the touchy issue of how close same-brand dealers should be from each other.

Marybelle D. Archibald, an administrative law judge of the California New Motor Vehicle Board, has upheld VW of America’s plan to establish the new franchise, according to the board.

She remanded the case this month to the vehicle board, which now will decide if the auto maker can install a new store in Montclair, 8.5 miles (13.6 km) northwest of Ontario Volkswagen.

Ontario VW’s owners claim the proposed site for the additional store violates a state franchise law that bars auto makers from locating same-brand stores within 10 miles (16 km) of each other.

But such legislation typically includes exemptions for special circumstances.

“It is injurious to the public welfare for an additional franchise to be established,” Ontario VW says in legal filings. “The additional dealership would result in ruinous competition.”

The auto maker says it is missing a chance to sell more vehicles by not opening the new dealership on a well-traveled roadway. Ontario VW claims the “lost-opportunity” analysis is flawed.

VW, which has said it hopes to double U.S. sales within two years and increase them to 800,000 by 2018, finds the Montclair site appealing because it is along Interstate 10 and offers high visibility other area dealerships lack.