C.A.R.S. in the News

"The California Senate overwhelmingly - and with bipartisan support - approved legislation that would allow car dealers to charge buyers up to $500 extra on each vehicle purchase, a blatant departure from promises both parties made this year to lower costs for Californians.

The bill's opponents said they were shocked senators would disregard their pledge by adding more 'junk fees.'

'This is the opposite of saving money for people,' said Rosemary Shahan of Consumers for Auto Reliability and Safety. 'There's no two ways about it. It's just benefiting car dealers at the expense of car buyers. That's it.'

Yet on Tuesday, just one senator voted against Senate Bill 791 that would raise the fees car dealers can charge to process documents by $415 from their current cap of up to $85 for a new or used vehicle. The proposal would allow dealers to charge as much as 1% of a vehicle's purchase price, up to $500. The average listed price of a new vehicle in the U.S. in May was $48,656, according to market research firm Cox Automotive. Some Democrats push back on 'junk fees'

Calabasas-area Democratic Sen. Henry Stern was the only senator to vote 'no' on the bill. In an emailed statement, he said car sellers have undermined California's efforts to protect consumers and the environment, including lobbying hard for the U.S. Senate to pass federal legislation that seeks to block California's electric vehicle mandates.

'The car dealers haven't earned the trust to justify this major increase in junk fees,' Stern said. 'Bad behavior shouldn't be rewarded.' "

Read more: CalMatters: "California car buyers face a 488% higher fee under a bill the Senate just passed"
 

"When you buy a car in California, the most the dealer can charge to process the sales documents is $85 but the cap could be raised to $500 if Senate Bill 791 becomes law...

Rosemary Shahan, president of Consumers for Auto Reliability and Safety, argued the measure would harm consumers.

'It's a huge giveaway to car dealers, including multibillion-dollar corporations like Tesla, Auto Nation, and CarMax,' Shahan outlined. 'They're the ones that will benefit the most at the expense of California car buyers.' 'If you belong to AAA, they offer this service of handling registering the car for free or for a very minimal cost,' Shahan pointed out. 'When you look at other states, there are some states that have no caps on the document fee, and it's crazy how much the dealers get away with charging people. But if this bill becomes law, instead of having the best cap for consumers, California would have one of the worst.'

Shahan added car dealers typically make most of their profits at the "back end" on financing and various add-ons. The California New Car Dealers Association is backing the bill."

Read more: Public News Service: "CA Senate to vote on bill to allow car dealers to increase fees"
 

"Texas had more than 6 million vehicles with open safety recalls in January, according to data from Carfax.

Federal law requires dealers to perform safety recall repairs free on cars that are up to 15 years old — but many drivers do not follow through.

It's common for vehicle owners to discard warnings about seemingly innocuous issues like door latches. But unrepaired defects have led to deadly accidents for drivers. But even if a notice does reach a vehicle owner, they might not recognize how serious a defect actually is, according to Rosemary Shahan, president of advocacy group Consumers for Auto Reliability and Safety.

'A lot of manufacturers in the recall notice, they're saying things like, "You may experience a thermal event." What they mean by that is your car could catch on fire,' Shahan said.

That technical jargon often does not cause the same sense of urgency as plain language might, which leads drivers to delay or ignore defects, according to Shahan.

While some recalls like acceleration issues are likely to raise immediate alarm, something as seemingly benign as an unfixed latch defect could cause a vehicle door to fly open on the highway. 'A lot of times, you know, people are just sort of taking on faith that this is a regulated industry, and what could go wrong?' Shahan said."

Read more: Dallas Morning News: Texans are ignoring car recalls. Advocates warn that could be deadly.
 

 
"Military borrowers pay higher costs and face greater financial risks than civilian borrowers when taking out credit to buy a car - according to a new report from the Consumer Financial Protection Bureau.

The report found service members tend to borrow larger sums, at higher interest rates over longer terms.

Rosemary Shahan, president of the Sacramento-based nonprofit Consumers for Auto Reliability and Safety, said yo-yo scams are common - where the victim signs an initial contract on good terms but then the dealer claims the financing fell through....

Last year under former President Joe Biden, the Federal Trade Commission finalized the CARS rule, which would combat dishonest sales tactics. Automakers sued and last month a federal judge put it on hold.

Shahan said the CARS rule would require dealers to tell you the price up front before you even go to the lot.

'It also has additional protections for military service members,' said Shahan. 'It prohibits car dealers from representing that they're somehow affiliated with the military, or have been approved by the military when that's not true, and would also require them to be more honest about the price of the add-ons and actually get your affirmative approval before adding them.' "

Read more: Public News Service: Report: Military service members pay more for car loans
 

 
"Starting this year, changes to California's 'lemon law' will make it harder for consumers to get a refund or a replacement vehicle.

The changes mean instead of just taking the car to the dealer for repairs, you're now going to have to formally notify the manufacturer via email or certified mail and include your name, the vehicle ID number, a summary of the problems and a demand for a refund or replacement.

Rosemary Shahan, president of the nonprofit Consumers for Auto Reliability and Safety, said if you do not take the step, you forgo lemon-law protections.

'They're going to feel like they can ignore you and refuse to fix the problem,' Shahan contended. 'Or just do a real, cheap, temporary Band-Aid kind of fix until the warranty expires, and then they'll tell you how much they want you to pay for the repair out of your own pocket.'

Gov. Gavin Newsom said he signed Assembly Bill 1755 reluctantly in order to cut down on lemon law lawsuits clogging the courts. Shahan noted lawmakers agreed to the changes only after General Motors and Ford threatened to support a ballot initiative capping attorneys fees in consumer lawsuits, something vigorously opposed by consumer attorneys, who are big political contributors....

Shahan noted the new lemon law said consumers who have negative equity, meaning they owe more on the lemon car than it is worth, can be forced to come up with the difference before the manufacturer will buy it back.

'The manufacturers will say, "Oh, we'd be happy to buy back your lemon but first you have to come up with whatever the negative equity is before you can give us clear title to the car,"' Shahan asserted. 'Most people can't afford to pay out of pocket, so they're going to be stuck with a lemon car.' "

Read more: Public News Service: New for 2025: A Weaker CA Lemon Law
 

 
"The year 2025 is shaping up to be a confusing one for Californians unlucky enough to buy a new or used car that turns out to be a clunker.

Starting Jan. 1, car buyers who purchase a faulty vehicle will have to navigate a new version of California's "lemon law" that for five decades has given consumers the right to demand car companies fix or replace defective vehicles they sell.

That is, unless lawmakers quickly pass a law that allows some of the car companies to opt out of the new requirements.

The confusion stems from a law Gov. Gavin Newsom reluctantly signed in late September, after the bill was hastily jammed through the Legislature in the waning days of the session following secret negotiations between lobbyists.

Newsom said it was important to address the problem of California's courts getting clogged with lemon law cases, even as critics said the bill significantly watered down consumer protections.

But Newsom said he signed it only after lawmakers said they'd introduce legislation next year to make the reforms voluntary for automakers....

As the Legislature sorts this out, Rosemary Shahan of Consumers for Auto Reliability and Safety said car buyers next year are going to have a tough time figuring out what to do if they drive a lemon off the lot.

'It's going to be really confusing for consumers,' she said....

...Shahan and other critics argue the changes will primarily benefit U.S. car companies, since they're the ones most commonly sued under the state's lemon law at the expense of consumers. Foreign car companies largely opposed the measure."

Read more: CalMatters: California's lemon law is changing and car buyers have fewer protections in the new year