Pushing Lemons over State Lines

"Consumer advocates say state laws controlling the resale of lemon vehicles are variable in strength and widely flouted – objections that for the first time are drawing attention in Washington, where the Federal Trade Commission is deciding whether to impose a national lemon resale standard.

Consumers for Auto Reliability and Safety, or CARS – a group based in Sacramento, which with the National Association of Attorneys General had petitioned the Federal Trade Commission to take up the issue – estimates that auto makers repurchase [at least 100,000] cars and trucks as lemons each year.

The big problem, consumer groups say, is the interstate transit of faulty vehicles. They accuse auto makers of exploiting 'lemon loopholes' to move vehicles through states that have relatively weak lemon statutes.

The FTC plans a public forum on the proposals Oct. 3.

Auto makers support a uniform law but object to subjecting good will buybacks to the lemon-law stigma·.Richard Blumenthal, Connecticut's Attorney General, argues that the FTC should not exempt goodwill buybacks from a national resale disclosure law. His state found that three times as many vehicles were repurchased voluntarily – outside the lemon law program – as following a formal complaint.

Similarly, an analysis of 1995 lemons in Washington State by Peter L. Maier, a Seattle lawyer, found that vehicles bought back prior to arbitration had at least as many serious defects as those acquired afterward."

– New York Times, August 27, 1996

 

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