A really weird story here that reflects incredibly poorly on GM.
I think this is the first time I’ve ever heard of this, but turns out GM has voided the warranty of a new Escalade-V owner because he refinanced his car. Not a flip/sell to someone else, no tuning, nothing. Just because he got better terms. I don’t really understand how this violates GM’s goal of stopping flippers for their higher end cars.
Read the story here:
Meh. Im sure it was auto flagged and will be corrected.
Find it hard to believe that this would pass muster under Federal warranty law (Magnusson-Moss) and state warranty law (Song-Beverly in CA for example).
This does not cover items sold for resale, such as a flipper.
So GM could get away with first owner only rule
Maybe, but this was the 1st owner/original purchaser and not a flipped owner.
Correct?
Thats the whole point, they will relent for him, i read your comment as a whole on the warranty void for all.
Now what if he resold it and he helped the new owner by taking it in for a warranty claim himself? Hmmmm
Nope, not at all.
I think the issue is that even though the article keeps saying “the title is the same“ that really isn’t true. The title has to be reissued with a new lienholder under the refi even with the original purchaser still listed. That is where GM is probably giving him grief on whatever the terms might be to prevent flipping - including voiding the warranty.
The MM fed warranty law would probably not allow GM to void the warranty on a refi only. Original purchaser is still the original purchaser, regardless of the refi.
My guess is they arent even giving him any grief, but rather this was autotriggered and theyre just moving slow in dealing with it.
At the end of article about Escalade-Vs losing their warranty and breaking down, there is an ad to buy used Escalade-Vs.
Seems like a combination of this and what Matt said: the car was paid off early and the released title is sitting in a safe, so all they can infer is the car was sold to a third party and the title is being floated.
Whatever the case, the #carbuzz is that this owner and this POS deserve each other.
I always thought that Federal law required that the warranty apply to all owners during the warranty period, not just the original owner.
However, Cadillac specifically states that a 2023 Escalade-V limited warranty transferability is subject to a 6 month retention policy.
Chevy has a similar limitation regarding the 2023 Corvette Z06, so I assume it must be legal to limit the transferability.
Which is ridiculous. GM happily punishes the end user, have they done anything to punish the dealerships that were marking Corvettes up for years and now marking up the Escalades? Legitimate question, not snark. Haven’t followed.
Dealerships are franchises that operate under protection of various state franchise laws. Even if GM wanted to, legally it is very difficult to stop them/punish them for marking up vehicles.
GM Doesn’t have to allocate high demand vehicles to said dealer anymore…not illegal.
Do you wonder why no automobile manufacture has effectively done that? It is because most, if not all, state franchise laws don’t allow them to. The ability to set your own price is a big part of being a franchised business and automakers have some of the most protective state franchise laws protecting them. Automakers can include a lot of restrictions in a franchise agreement but telling a franchisee they can’t sell a car for a price of their choosing, or retaliating against them for doing so, is generally not one of them.
Also, these car dealerships are not like mom and pop Subway sandwhich stores which corporate can easily bully around. State dealer association usually have tremendous influence on the state legislature (whether in deep red MS or deep blue MA). And the big chains can afford to go toe to toe against the OEMs with the same high priced lawyers (if you have doubts look at Ernie Boch Jr.’s Vineyard estate)
I always assumed it was that mom and pop dealerships can’t afford all that floor plan…go figure.