Posted On: September 29, 2009

Differences between theTexas lemon law and Toyota's safety recall

Toyota recently issued a safety recall to address its vehicles' abnormal acceleration while in operation. This will be considered one of Toyota's largest recall and perhaps most costly recall in the United States relating to the safety of the vehicle.

The reason why this recall is considered so massive is because it applies to numerous Toyota models, including the ever popular Camry, Avalon, Prius, Tundra, Tacoma, and Lexus.

The actual recall itself is still pretty vague. Toyota's current recommendation is to remove the floor mat underneath the accelerator to prevent it from sticking between the gas pedal. Toyota still has not issues any official notice for a permanent fix.

Why is Toyota issuing this recall, rather than not doing anything and waiting for consumers to file lemon law claims? Well, Toyota has known about this problem since 2004, when Toyota drivers reported numerous crashes and injuries due to uncontrollable acceleration. Toyota waited Five years later, right up until the National Highway Traffic Safety Administration (NHTSA) finally issued a warning. (Talk about red tape and bureaucracy in action)!

So, how is a safety recall such as this one different from a lemon law claim in Texas? Both situations pertain to defective cars. However, in a safety recall, the car manufacturer is the entity that proactive will correct the defect. In a lemon law claim, you would have to assert your right through the administrative process, or sue under consumer protection laws such as the Magnuson-Moss Warranty Act or Texas Deceptive Trade Practices Act. Also, a lemon law claim is usually smaller scale, while a safety recall involves several hundreds of thousands, if not millions of cars.

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Here's the kicker...Irv Miller, Toyota's spokesman, really shows how much he cars about consumer safety by saying that if Toyota owner's can not remove the floor mat, then they should merely "step" on the brake pedal with both feet until the vehicle slows. Right,...because stepping on the brake pedal with one feet is obviously not enough.

Posted On: September 25, 2009

Ford's Third China Plant may inevitably produce some lemon cars

Amid a decline in car production and sales in the United States, Ford recently made the announcement and is currently working on building its third car plant in China. As in any car plant, the production of vehicles that may be lemon cars subject to the Texas Lemon Law is inevitable.

The real question is whether the number of defective lemon cars produced at this new car plant will be disproportionately higher than Ford cars made in other plants or countries. It is a matter of quality control and I hope that this new China plant will be better than most products I have experienced with that comes from China. Lead and toxic chemicals in children toys come to mind...

This new third Ford car plant has the capacity to build approximately 145,000 to 150,000 cars each years. As speculation, a percentage of those cars may eventually enter into Texas' stream of commerce.

If you drive a Ford that requires multiple visit to the dealership for repairs within the first 6 months of ownership, you may want to call up a lemon law attorney to learn what your rights are.

Posted On: September 16, 2009

How General Motor's Money Back Guarantee will create more lemon cars in the demo and used car market

At the end of the day, it's all a numbers game. For future demo or used GM car buyers, the number might not be in your favor. Here's why...

General Motors' new money-back guarantee will most likely attract many consumers and new car buyers between September 14 - November 30. After the wave of car purchasers drive the vehicle for 31 to 60 days, a percentage of these folks will take advantage of the money-back guarantee program and return the vehicle (sometimes between October 15 through December 29).

The reasons for returns, like electronics, may vary from preference (nothing is wrong with the vehicle) to defects (the vehicle's engine is sputtering black smoke and it's been taken back 4 times for repairs). Unlike returned electronics, GM has been silent and has not mentioned any refurbish or product re-certification program.

In other words, cars returned from the money-back guarantee may or may not have a "refurbished" sticker on them. They will join the inventory of other used cars and there will most likely be a flood of used cars on the market by December or January.

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Another indirect problem this will create points to simple economics. More supply equals less demand and decrease in price. In other words, with the saturation of used GM cars on the market, depreciation will probably be worse than it ever will be.

If you are think that used cars are protected under the Texas Lemon Law program, then think again. The protection is very limited and often times, not very advantageous for the consumer.

I hope my projections are wrong. If it is not, then it appears that GM's money-back guarantee program might be a lemon program.

Posted On: September 14, 2009

General Motor's Anti-Lemon Law Money Back Guarantee, with Strings.

Fifty billion dollars of taxpayer's bailout money and numerous lemon cars later, General Motors is attempting to regain consumer confidence and a segment of its lost shares in car sales by offering a sixty days (60) money back guarantee. The money back guarantee sounds enticing, but buyer beware,... like most offers in life, it comes with strings.

String #1: You must purchase a GM vehicle between today (September 14th) and midnight November 30th. Make sure that when you have finally agreed on a deal with the dealership, that all paperwork is dated within this time-frame. Do not allow the dealership to back date any documents you sign.

String #2: The vehicle must be a new 2009 or 2010 Buick, Cadillac, GMC, or Chevrolet. No used or pre-owned cars!

String #3:
You can only return the vehicle you purchased AFTER 31 to 60 days after purchase. Here is the kicker, upon return, you MUST have driven the vehicle less than four thousand (4,000) miles. That is about 67 miles to 129 miles per day. (You hot shot drivers who intend to use this vehicle for commercial purposes -- don't bother).

String #4: The money back guarantee DOES NOT include dealer installed accessories. Keep in mind that dealers add several hundreds to thousands of dollars in accessories as a way of making additional profits. Who wants new floor mats that has the GM logo engraved on it for about seventy-five dollars anyways?

String #5: The money back guarantee DOES NOT include negative equity. In other words, if you are planning on trading in a vehicle that is worth less than what you owe to your creditor (the car financing company) -- then DO NOT do it. In the event that you return this car within the requirements above, you are still responsible for the difference in negative equity (an amount that the dealer often absorbs).

I appreciate GM's new program and it appears that the company is heading toward a positive direction. However, please note that lemon cars often times don't manifest problems until after 3 to 6 months of ownership. Perhaps GM should focus on designing vehicles with engine and components that are more reliable,...and let its product speak for itself. Personally, I would rather buy fresh quality lemons and never have to worry about returning it than buying sub-par lemons only to have to deal with bringing it back to the store again. Hey -- it is your time and patience -- you decide what its worth.