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Bankruptcy? What happens to my car warranty then?

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Comments

  • steverstever YooperlandPosts: 40,012
    The other ones we get are those that think any post that's at all negative about the brand that love is a troll post.

    It works better if people just talk about the topic.

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  • fezofezo Posts: 9,328
    Topic?

    Wow. What a concept. :P
  • steverstever YooperlandPosts: 40,012
    Yeah, it's just about a bankrupt idea eh? :shades:

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  • Even if the car company goes bankrupt, there is still money in servicing those cars. Part of the bankruptcy agreement will entail servicing the warranties.
    Just expect bad service by a third party company. But hey, if you bought a GM your probably expecting to spend time at the service station anyway.
  • Karen_CMKaren_CM Posts: 5,020

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  • Hello,

    I read the news articles about the federal govt. honoring GM and Chrysler warranties.

    "The program will cover consumers who buy a new GM or Chrysler vehicle during the restructuring period, according to a U.S. Treasury Department statement."

    What if you already own a GM car with an extended warranty and they declare bankrupcy??

    My son is going to college in the fall. We bought him a 2007 Malibu Maxx with all the extra safety features curtain & side airbags, etc. We also bought the extended warranty to cover him while he was away from home in college.

    But what happens if GM goes bankrupt??? The current proposal by Obama's administration only covers cars purchased during an upcoming transition period.

    We're still making payments on the car, including the cost of the warranty. I feel sick.

    Thanks for any info anyone can share.

    A concerned mom
  • corvettecorvette United StatesPosts: 4,079
    There is currently no definitive answer for what may happen with the 3/36 and 5/100 factory warranty.

    I believe the GM factory extended warranty is underwritten by GMAC, which is a separate entity than GM. GMAC has been described as "cash-strapped," but isn't in such dire straits as GM itself.

    If it makes you feel better, you can cancel the GMAC warranty and get a prorated refund. If you financed the warranty, I think the payoff goes to the lender, but this will reduce the principal balance of your loan.
  • I think I'd worry a lot more about resale value if these guys go belly up. Priced any oldsmobiles lately? I really wanted to pull the trigger on a CST AWD, but.........
  • wp746911wp746911 Posts: 24
    So IS the federal govt covering the warranty, or are they just saying they WILL/MIGHT? Is the warranty protection in place already or is it something pending blah blah legislation? I'm looking to buy a town and country but need some warranty assurance.
  • fezofezo Posts: 9,328
    I wouldn't count on that assurance. The plan is to offload the warranties on a third party company and details are not anything like solid. If you are thinking they'll just back the lifetime warranty that Chrysler advertises I would not count on it.
  • thats what the news reported,maybe i can get my congressman to replace my fuel pump.or diagnose my check engine light,ehh? i wouldn't worry myself about it,life's 2 short,ya know...and there's always gonna be another problem to take your mind off of this one. drive careful crew.
  • Henderson confirmed the last Saturn vehicle will be built this year unless a buyer for the brand emerges with a good offer. GM will phase out Saturn by the end of this year.
  • cadillacmikecadillacmike Posts: 543
    Gee, not too many relevant posts here.

    I'm concerned about my wife's car which still has a supposed "factory warranty" through next summer (if she doesn't hit the mileage limit first). It's a CTS, which has been pretty trouble free. But as for buying a new car - not right now, no way, I like American cars but not Fords or Chryslers (Cadillacs for me thank you), and there's no way I'm getting sucked into this malestrom. I think I'll find a nice 1995-96 Fleetwood to replace the one i crashed before getting sent overseas. They'll be relatively inexpensive, can last forever and I LIKE them.
  • Mr_ShiftrightMr_Shiftright CaliforniaPosts: 44,416
    Unless I'm missing something obvious that goes against all previous history--when a car company goes Ch 7, it liquidates, and all owners are SOL when it comes to warranty. That's it.

    Not to scare anybody, but if my history is correct, no American car company has survived bankruptcy since Studebaker in 1934--which hung on another 32 years, probably thanks to WW II.

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  • dtownfbdtownfb Posts: 2,915
    As long as GM remains in Chap. 11, owners shouldn't see anything different. Chrysler is about to emerge from bankruptcy any day now. How long the new company last is another story.
  • gagricegagrice San DiegoPosts: 28,850
    If you buy a new vehicle from one of the dealers that has lost his franchise. Do you think the company will warranty it? The Chrysler dealer in Florida with 125 new cars claimed he could not sell them as new after June 9th when his franchise is pulled. I would think those cars are near worthless. How the resale can do anything but go in the toilet is beyond me. If Toyota is selling new Tundra PU trucks at 2/3rds MSRP, what would a Dodge PU truck be worth. Maybe half new price.
  • dtownfbdtownfb Posts: 2,915
    It shouldn't matter if he can sell them new or not. As long as Chrysler is in business, they have to honor the warranty. The 3yr/36k mile warranty is in affect new or used. Now the Chrysler Lifetime Powertrain Warranty may be a different story. I'm not familiar with details of the warranty but I would hope that Chrysler would honor the Lifetime powertrain warranty since the cars have never been titled.

    I think all Chrysler's are worthless but i agree that all used Chrysler's will take a huge hit in the resale value on June 9th esp. 1-3 year old cars. similar to what happened with Oldsmobile. You can probably buy a new Chrysler for cheaper than a 1-3 used one.

    Interesting times. I'm about to get into the maket for a new/used car. should be fun.
  • volvomaxvolvomax Posts: 5,274
    If the dealer sells the car AFTER his franchise is pulled, Chrysler DOES NOT have to honor any warranty.
  • dtownfbdtownfb Posts: 2,915

    If the dealer sells the car AFTER his franchise is pulled, Chrysler DOES NOT have to honor any warranty.


    Why wouldn't the basic 3 yr/36k mile warranty not be honored? I understand the Limited Lifetime warranty wouldn't be honored.

    Is this because the cars would be considered used cars?
  • corvettecorvette United StatesPosts: 4,079
    I think the car has to be delivered (and the warranty activated) from an authorized dealer. If they don't have a franchise, it's basically a grey market car.
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