Lemon Law Blog

Throughout the year, we receive countless calls from folks looking for car buying advice.  Many figure that by calling 1-800 LEMON LAW prior to buying a car, they may be able to prevent problems “down the road” so to speak. For that reason, since 2001, we have teamed up consumer advocate Jack Gillis and the wonderful team at the Center for Auto Safety to provide the Car Complaint Index to consumers.  We feel that an educated consumer is an effective consumer. 

Yesterday, JD Power & Associates came out with their dependability rankings and it appears that Land Rover is lowest on the Power totem pole.  While the Car Complaint Index looks at specific models, JD Power looks at brand quality.  They rank their cars based on an average of car problems; how many problems are reported per 100 cars, as experienced by original owners of these cars after three years.  The industry average is 206 problems per 100 cars, roughly averaging 2 problems per car.

Here are the brands that fall below the industry average:  Audi 207, Mercedes Benz 215, Nissan 224, Pontiac 225, GMC 226, Mazda 228, Subaru 228, Chrysler 229, Dodge 230, Mini 233, Chevrolet 239, Hummer 241, Scion 243, Volvo 244, Saturn 250, Jeep 253, Volkswagen 253, Saab 254, Isuzu 274, Kia 278, Suzuki 302, and lastly Land Rover with 344 problems reported per 100 cars.  This is not good news for the SUV manufacturer, which was recently sold by Ford to an Indian company.

So, who’s on top?  Number one with a bullet for the 14th consecutive year is Lexus, followed by Mercury and Cadillac.

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General Motors, not wanting to face the fate of bankruptcy, is scaling back with an overall $15 billion cost-cutting program, as reported by Mike Harris of The Associated Press. Speedway Motorsports Inc., which owns eight tracks that hold NASCAR events, already has been told GM will not renew contracts at two tracks — New Hampshire Motor Speedway and Bristol Motor Speedway. In addition, the company has suspended its stock dividend, another huge blow to investors who have seen their shares dip to the lowest prices in fifty years. And finally, to reward those employees who have stood by the company through its trials and tribulations, The Street is reporting that they will no longer offer health care to retirees, effective January 1, 2009.

However, depsite the gloom and doom that has been haunting the automaker, the company is remaining optimistic with their plans for the upcoming year. A story in the Baltimore Sun reports that GM’s sales fell 16 percent in the first half of the year, with trucks off 21 percent and cars down nearly 9 percent. GM Prez Fritz Henderson says that for the company to succeed, they must repair their car brand image and “steer” away from trucks (pun intended.) The Chevrolet Malibu has seen its sales increase a whopping 46 percent in the first half of the year, even though the new and improved quality and style resulted in an MSRP increase of $4000. Eighteen of the 19 vehicles GM will unveil between now and 2010 will be cars or crossovers, including a smaller Cadillac.

The manufacturer is also kicking the clunky Cobalt to the curb, replacing it with the sleek Cruze, a little powerhouse with a 1.4 liter turbo-charged four-cylinder engine that will allow it to get a fantastic 45 miles per gallon.  The Cruze is coming to a GM dealer near you in 2010.

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As you can expect, we have successfully handled thousands upon thousands of GM lemon law cases through the years….Cadillacs, Buicks, Chevrolets, Corvettes, Pontiacs, Hummers, etc.  Founding Partner and Lemon Law Attorney Bob Silverman has taken charge of many of these cases, and he has always felt that, despite the fact the glitches occur, GM has constantly exhibited a strong commitment to quality and customer service.  We have also seen that many of our GM clients have illustrated tremendous brand loyalty, buying a brand new GM vehicle following their lemon law experience.  Thus, it is quite disheartening to hear that this once invinceable auto giant is suffering a tremendous amount of troubles and tribulations.

Bloomberg reports that the company has suffered a 16 percent decline in 2008 U.S. auto sales and the price of GM stocks is now at a 54-year low (Shares have tumbled 62% this year, the most among the 30 companies in the Dow Jones Indsutrial Average). However, despite continuous speculation that GM could file for bankruptcy in the next year, Chief Executive Officer Rick Wagoner says that the company has “no thoughts whatsoever” of bankruptcy.  Wagoner also says that Hummer is the only one of GM’s U.S. brands being studied for possible sale or shutdown. As gas prices continue to soar, the manufacturer will review the truck’s future and sales potential. He adds that the bankruptcy rumors have not resulted in any drop in sales, with GM sales falling less than 1 percent in the first three months of the year.

As a company, GM has not posted an annual increase since 2004, with no U.S. sales gain since 1999. Last year, they suffered an astounding $38.7 billion loss. Outside analysts say that in a worst case secnario, with sales continuing to decline and an inability to acquire much needed captial, GM might have to declare bankruptcy by the end of 2009 or beginning of 2010, but they put the odds of that happening at 25 percent.

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This morning, while taping a segment for the CW talk show “Speak Up,” we met up with one of our former clients, John Bryant.  John, an accomplished attorney himself, had endured several significant problems with his Cadillac. The battery kept dying, again and again, and he found himself back at the dealer on five different occasions.  He thought that General Motors would certainly do the right thing and exchange his car with a new one under the Pennsylvania Lemon Law.  When they refused, he upped the ante and told the dealer he would pay them $10,000 and turn in his car in exchange for a new car and he was still getting the run-around.  It was around that time that his daughter got involved.  She had heard about Kimmel & Silverman and she looked up lemon law.com on-line.  Once John contacted us, we started representation and shortly after, John received an MSRP to MSRP swap, exchanging his 2003 Cadillac for a 2008 Cadillac.  He paid NO attorney fees (as you know, if we can help, it is completely free) and only paid $2,400 in mileage and upgrade offset, MUCH LESS than what he offered the dealer.   Needless to say, he was thrilled.

So, what’s the moral of the story?  Dealers can only do so much to help the consumer.  When dealing with a lemon law or breach of warranty issue, the defendant is NOT the dealer; it is the manufacturer. Many a dealer has whispered “1-800-LEMON-LAW’ to their customers over the years.  They do this because they know they have no control, and really want to help.  If you find yourself in a similar situation, don’t bend the dealer’s ear, hoping that he will come to your rescue.  Instead, research your lemon law and breach of warranty rights, make sure you keep all of your repair invoices, and look into hiring a lemon law attorney.  It is cost-free and risk-free.

For those in the Delaware Valley, “Speak Up” will air this Sunday morning at 8am on CW57. In addition to John, the program will feature lemon law attorney Amy Bennecoff and Director of Communications & Automotive Consumer Advocate Michael Sacks.

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