Dealing with Dealers Closing Their Doors

December 11, 2008
By: LemonLaw

As we await word on if/how the government will bail out the big three, we continue to see car dealers close their doors in record numbers as a result of this troubling economy.  And these are not fly-by-night agencies mind you; these are long-standing, highly respected dealerships that have been running in some cases for decades.  It’s a sad state of affairs for the automotive industry and now more than ever, it is important that you protect yourself in case your selling dealer closes. 

Pennsylvania Lemon Law Attorney Craig Thor Kimmel appeared on FOX 29 News in Philadelphia earlier this week to discuss how to deal with the dealers closing around us.

FIRST, when buying a car, make sure you keep all of your paperwork.  With dealers closing, you need to make sure you have all agreements in writing.  We recently saw a case where the dealer was supposed to pay off the loan of a trade-in as part of the sale.  Then, the dealer closed and the consumer received a call from the bank asking for payment.  You need to get everything in writing. 

SECOND, make sure you understand the warranty you are purchasing.  It is highly recommended that you purchase a vehicle that has a manufacturers warranty and that any extended warranties purchased are also backed by the manufacturer.  Manufacturers warranties allow you the freedom of taking the car to any authorized manufacturers dealership.  Dealer warranties prohibit this.  Also, if your problems continue under the manufacturers warranty, you may be able to seek recourse under State and/or Federal Laws.

THIRD, make sure when taking your car in for service that you be as specific as possible regarding repairs needed.  Dealers that are not closing are still cutting back, letting go of service personnel and not spending nearly the time on repair visits that they used to.  Make sure you are as specific as possible in terms of what noise you heard and when you heard it, what sensor light popped on, and where you felt that water leak.  The more clues you give, the better chance the service personnel have of solving the problem.  And if you continue to once again feel like you are getting the run around, either a dealer constantly saying no problem found, or the problem not being fixed properly, you need to look into legal action.

FOURTH, if you feel your car is giving you problems, you need to do something.  When Daewoo was purchased by GM following economic problems, the acquired all the assets but none of the headaches. They were not responsible for any Daewoo warranty claims.  If a bankruptcy was to hit one of the big three, there is a good chance hundreds of thousands of people would no longer have warranties on their vehicles.  If something is wrong with your car, you need to get it addressed NOW. And if you feel that you may have a breach of warranty or lemon law claim, you need to address it with a consumer lawyer as soon as possible to protect yourself.  Under State and Federal Laws, help is free in these situations.  You have absolutely nothing to lose and everything to gain. 

For more information regarding this matter, visit and if you have any specific questions, e-mail Client Services Director Michael Sacks at,  Include your name and daytime phone number, including area code.  We may include your question in a future blog.

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