Automotive LEMON Law for auto industry

Published on May 22nd, 2022 | by Daniel Sherman Fernandez


Why We Need Automotive Lemon Law In Malaysia ASAP

Lemon Law inconsistencies and what the Malaysian Government can do.

Here Is A Typical Car Buying Scenario in USA And Europe

Antonio buys a brand-new car and owns it for 3 months. Car has sudden stop/start and stuttering issues while driving along highway. Definitely a serious safety issue for Antonio. Car is sent back to the car dealer after sales. Dealer cannot fix the car despite repeated attempts by after sales and also the car manufacturer.

Car is bought back by dealer and Antonio is reimbursed fully for all his monetary losses (depreciation, replacement car, usage, legal fees etc.). Antonio views it as the ultimate in protection of consumer rights (Lemon Law). Antonio walks away happy and buys another car at the same Dealer. Antonio is happy, dealer is happy, the automotive brand is happy.


Typical Car Buying Scenario in Malaysia

Arumugam buys a similar brand (as above) new car. He has the same problems as Antonio with start/stop and stuttering while driving. Ahmad sends his car to the Malaysian dealer. His agony has just begun. Little did he know what “Customer Satisfaction” really meant when he bought the car. 

The dealer and the car manufacturer will now play “tai chi”, and make it travel to and fro the dealership to the salesperson, to the customer service advisor to the after-sales department. The finger pointing starts and never ends.

They cannot seem to fix the problem nor admit liability and his car is in and out of workshop. Only answer he gets is that car is still under warranty and he must just keep sending this ‘defective’ car in over and over until the warranty runs out.

He hires a lawyer (incur more expenses), writes to all and sundry (Ministry of Consumer Affairs, Consumer Tribunal, Car Manufacturer HQ in Europe/USA). Every day he loses money as he is without a car to commute and do errands. His legal expenses keep mounting with every correspondence. He loses faith in the car brand and their constant our customers are our 1st priority slogan.

We have seen this situation with many car owners and till today there is no solution (except to have Lemon Law) and thousands of car owners in Malaysia either sell the car at a high loss or keep driving a faulty and dangerous vehicle. Probably why we have plenty of road accidents and car fires in Malaysia.

Before we go into the differing treatments accorded to car buyers locally and overseas, it is good to recap what “Lemon Cars” are. After that, we can ask the critical Qs as to why this situation persist in Malaysia and if a quick solution can be found.

LEMON LAW Malaysia

Definition:  A “Lemon Car” is defined as a car that has returned to the workshop at least 3 times for the same problems (safety or otherwise) and cannot be fixed at the dealership (by manufacturer) despite repeated attempts. The OEM via the dealer is obliged by law to buy back the defective car, reimburse the buyer on his monetary loss (usage, depreciation, even legal fees if it goes to court) because a clear “Lemon Law” exist in the USA and Europe.

This is the ultimate legal tool in customer protection against product liability especially for an expensive item such as a car. In some countries (eg Europe), they even have a Used Car “Lemon Law” which accords protection to used car buyers. These laws are decades old in such countries and big brands are already used to such customer protection legal rights.

Text by Capricon1965

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