Lemon Law Blog

Another manufacturer is taking radical steps to get out from under. The New York Times is reporting that Chrsyler Financial will stop offering leases to consumers, effective today.  The reason is that plummeting resale values for SUVs and trucks have made it practically impossible for the manufacturer to turn a profit once the consumer turns the vehicle in from a lease.  Leases will still be offered through independent banks.

James Press, co-president of Chrysler, says that in place of leasing, the company will divert their efforts towards creating new, more attractive financing options for drivers. This makes sense for both the consumers and the company, as low interest rates make financing more appealing and there is a far lesser financial risk for the automaker. The Associated Press is reporting that Chrysler will offer 72-month finance deals starting this month on a large variety of its compact, midsize and full size cars. The new program will allow monthly payments lower than previous finance offers and similar to its 36-month lease program.  Some purchases will also include a cash bonus of up to $2000, plus there will be a loyalty incentive for returning lease customers and the lease disposition fees will be waived. 

Ford and GM still plan on offering leasing, despite both suffering billion-dollar losses for similar reasons.

Quick programming note for those in Philadelphia and the Delaware Valley:  Looking to save a few bucks by buying a used car?  Do your homework first or else your dream car could have been someone else’s nightmare. Watch Lemon Law Attorney Craig Thor Kimmel tonight at 10 on MyPHL News on Channel 17.

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As we have reported repeatedly on this blog, car sales are down big time! As a result, dealers are doing everything they can to make a sale.  Unfortunately, some dealers are more concerned with getting the cars off the lot immediately than they are about securing financing for their customers.  And as new car sales continue to be more competitive, we are receiving a plethora of calls at 1-800 LEMON LAW regarding a dealer tactic known as spot delivery.

Most folks have heard of this tactic before.  An alleged spot delivery transaction between a NJ consumer and the Brad Benson dealership found its way on National TV (and throughout cyberspace).  Spot Delivery occurs when a dealer puts a consumer in a new car “on the spot,” with the consumer signing a number of documents, including a retail sales agreement.  Later on, the customer starts receiving calls tellling them their financing did not go through. In most cases, they are trying to get the customer to come back to pay more money than they originally agreed to.   Some dealers play dirty when this occurs.  They may threaten repossession, or not pay off a trade-in, or make numerous threatening phone calls. And in most cases, customers feel trapped into paying more money.

So, what should you do? You need to stand your ground.  If you signed purchase doucments and registration applications, obtained insurance, and a new license plate installed or an old plate transferred, the car belongs to you.  Here are some other tips to follow if you find yourself in a spot delivery situation:

• Keep all copies of your paperwork and anything else associated with the sale (including calendars, photographs, advertisements). If the finance manager asks for your papers at any time for any reason, refuse! Keep these documents in a safe place, not the car.
• If you are called back to the dealership to sign additional papers, either do not go or do so in a different car than the one you bought.
• Have a friend or spouse drive you and witness whatever is being told to you. This will prevent the dealer from taking your car as hostage, an all too common happening.
• If a dispute arises with the dealer over the contract and the dealer demands the car is returned, park it in a garage or remote location until the matter is resolved, to prevent it from being taken against your wishes.
• Put together a complete time line of everything that happened from the time you thought of purchasing the car until the car was taken away. Try to remember specific names of dealership personnel and any statements that were made to you during conversations with the sales and finance staff.
• Keep track of all monies you had invested into the purchase, including registration, insurance, down payment and trade. Never pay cash and always get a receipt!

If after reading this, you realize that you are a victim of spot delivery, you may want to contact a consumer attorney to take action. At this time, we are handling spot delivery claims in Pennsylvania and New Jersey. If you are in either state, please contact us via e-mail or by calling Michael Sacks, Director of Client Services at 1-800 LEMON LAW (1-800-536-6652) ext. 131.  If you reside in another state, contact your attorney general or check out our attorney directory.

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We are equal opportunity bloggers. It appears that misery loves company and being that we have already reported on General Motor’s spiral downfall, they should be happy that we are now discussing Ford’s foibles. The Los Angeles Times is reporting that despite an unexpected $100-million profit the first quarter, the manufacturer significantly suffered second quarter with a $8.7 billion loss, their largest quarterly loss ever. Much like GM’s situation, the huge loss is being blamed on soaring gas prices and the huge crash in consumer demand for trucks and larger SUVs (although we still get calls about F Trucks every single day).

Ford appears to be following in GM’s footsteps and will be concentrating their efforts on producing smaller, more fuel-efficient cars, according to chief executive Alan Mulally. And there’s good reason for this; truck and SUV sales have declined 18% this year, while Ford Focus sales are up 27%.

In order to achieve their goal, they are shifting production at a variety of their plants. The Detroit Free Press reports that SUV and truck plants in Michigan, Mexico, and Kentucky will all be converted by 2011 to produce smaller cars, including cars derived from the manufacturer’s new C-car platform and a new verion of the Ford Fiesta. There is a bright side; a Twin Cities, Minnesota plant originally scheduled to close in 2009 will stay open through 2011 to produce the compact Ford Ranger pickup.

Time will determine if these plans are in fact “built Ford tough,” or if there are going to be unforseen potholes on their road to financial recovery.

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The Northeast has been hit with some wet, wild weather in the past 48 hours. As a result, our lemon law mailbox  has been “flooded” with questions like this:

“I bought a Chevrolet Aveo about a month and a half ago. Yesterday we had a rain storm and I went out to my car, the entire windshield on the inside was dripping wet…what are my options?”

The day after a storm, many distressed drivers discover leaks in their vehicles. And, if those leaks are not immediately addressed and repaired, your car will soon be a nesting ground for mold and mildew.  So, what should you do if you find puddles on your passenger floor (or elsewhere in the car)?

**Make a service appointment with your dealership immediately. Make sure the service manager understands the severity of the situation.

**Try to track down where the leak or mildew scent is coming from. If you can point your service manager in the right direction, they may be able to fix it immediately. Also, let the service manager know when the scent is the strongest (i.e. when starting up the car, when turning on the heater to high, when turning on the rear defroster, when it rains.) The more information you can provide your service manager, the better!

**Make sure you receive a repair invoice outlining your problem and their solution. Do not let them mail the invoice. Have them print out the invoice when you pick up your car.

**If you still smell the fumes after your service, you need to bring the car back to an authorized dealership for another repair attempt. If you feel your dealership is not handling the problem correctly, take your car to another authorized manufacturers dealership.

**If your car is under manufacturer’s warranty, you should not have to pay any extra monies for treatments or ventilation services. This problem should be covered under both the original and extended manufacturer’s warranties.

**If your car is under manufacturer’s warranty and you have given the manufacturer 3 or more chances to fix the problem, you can assert your rights to cost-free legal representation under State Lemon Laws or Federal Warranty Laws.

Don’t let your manufacturer leave you hanging out to dry. Take action if necessary.

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As the comments continue to pour in regarding our entry on paint defects with 2000-2005 Ford vehicles (54 so far, but who’s counting?), we thought now would be a good time to discuss when a paint problem can turn into a lemon law or breach of warranty claim. 

We frequently receive calls from distressed drivers who are quite peeved over their paint.  If the dealer is making any effort to fix the problem, either by buffing, or compounding, or painting certain components, you may have grounds to file a claim. Make sure that you ask for a repair invoice after each visit.  These invoices should outline your complaint and what was done to fix the vehicle.  Depending on the invoices, we may be able to argue that the paint problem has diminished the value of the vehicle and therefore, the consumer is entitled to remedy under State Lemon Law or Federal Warranty Law.

Unfortunately, many folks call to complain of paint chips on their hood.  These chips are often caused by road debris and while it’s extremely frustrating, these repairs are not covered under warranty. However, repairs that may be covered include paint peeling, rust, and blotches or scratches in the finish.

It’s important to ask questions.  If you feel that your paint defect may be affecting the value of the vehicle (and you are still covered under a manufacturers warranty), bring the issue to your service manager. And, if they can’t fix the problem after a couple attempts, you should certainly consult a lemon law attorney.  You can always ask us a question by here.  Remember, never be afraid to fight for your rights!

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The high gas prices have all of us in a tizzy.  You will find numerous stories related to the problem everywhere you turn…television, internet, newspapers, even this blog. And the stories are teasing us.  Good Morning America is reporting that although the price decrease of crude oil was the largest three-day decrease in decades, it didn’t really affect the pain we are feeling in our wallets. The Nation’s average cost-per-gallon dropped from $4.11 to $4.07, which leaves most motorists saying “Big Whoop!”  But wait, a ray of hope….the newscast goes on to report, that we could see larger drops if the price of crude oil stays below $130 a gallon (sounds good). But then Bruce Bullock, Director of the McGuire Energy Institute predicts that we will see a price of $150 a barrel by the end of the year. (aw, crap.) Our hopes for a little less pain at the pump are shattered quickly and painfully.  And, we are talking planes, trains AND automobiles, so you can imagine how this could cripple holiday travel. 

As a Country, we are not happy.  Everyone is looking for an explanation and a solution. It’s no wonder that we have numerous calls from distressed drivers to 1-800 LEMON LAW, complaining that they are not experiencing the high mileage per gallon which was mentioned on their MSRP sticker and featured in the glossy TV ads.

So, what can we do to save a dollar or two? In the past, we featured an article from cnn.com with some simple ways to add miles to your gallon. And now, New York Times Writer Peter Applebome is reporting that Senator John Warner, a Republican from Virginia, is suggesting that Congress consider returning to a national speed limit to save gasoline, and possibly ease up on fuel prices. While, he does not specifically throw the number 55 out there, he asked the Energy Department to help determine the most fuel-efficient speed limit. He notes that as a Country, we saved a whopping 167,000 barrels of petroleum a day when the 55 miles per hour speed limit was in effect.  With experts saying our fuel efficiency radically drops when we hit speeds above 60 mph, the Senator feels that every 5 miles we go above the threshold costs us a whopping 30 cents per gallon.  And he’s not alone; the Drive 55 Conservation Project has a website endorsing a 55 mph speed limit.

Your thoughts? Given how cars are constantly zooming past me on state highways (and I can assure you I am going quite a bit faster than 55), I am not convinced that consumers will be “driven” enough to reduce their speeding ways.

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