Lemon Laws and the ACL

Edit: New readers to the topic can join at August 2024 by clicking here.

Australia desperately needs lemon laws to deal with dodgy cars and dodgy dealers.

Reports of major problems with specific brands - notably the Chrysler/Jeep range, Mercedes and BMW, and horror stories about dealers and importers highlight the need. Add to that the appalling saga of Volkswagen’s (and its other brands’) deceptions and the need for consumers to be protected by law.

Fortunately I don’t own any of the affected brands, but I’m horrified at reading and hearing about the horrors that people who do are going through.

I suggest that Choice urgently needs to warn consumers about these dodgy brands and shady businesses and to champion lemon laws like those that protect US consumers.

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Hi Fred,

We’ve been looking really closely at the lemon car issue recently, and conducted a nationally representative survey to find out how many lemon cars are out there, and whether or not consumers are able to get their problems fixed. Our report also looked at the worst car brands, in terms of number of problem cars. You can read the report here - https://www.choice.com.au/transport/cars/general/articles/lemon-cars-and-consumer-law

A review of the Australian Consumer Law is currently underway, and we’ve raised our concerns about lemon cars in our submission to the review. We’ve recommended a taskforce be established to fix problems in the new car sector, with industry-specific lemon laws to be introduced in two years if the taskforce fails to fix things. You can read our full submission here - https://www.choice.com.au/shopping/consumer-rights-and-advice/your-rights/articles/consumer-law-review-2016

Our concerns are being listened to. The ACCC has just announced that it will be conducting a 12-month market study into the new car market. We will be following this process closely, and will continue to call for reform throughout the ongoing review of the Australian Consumer Law.

Sarah Agar
Policy & Campaigns Adviser

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That’s great - thanks Sarah! It’s good to see Choice is on the job. :smiley:

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With regard to lemon laws, is it possible to include recall laws?
Many people who buy a second hand vehicle don’t let the manufacturer know that they now own the vehicle and therefore miss out on recall notices.
Should it be law for the car sales person to notify the manufacturer of the new owner, or at least have a form that can be filled in?

These recent airbag recalls go back many years. Most people don’t even know about them unless a friend tells them.

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This is an interesting idea, and one to explore. We looked at the recall system as a part of our submission to the review of the Australian Consumer Law, and we considered a few different options for improving the ways that recalls are communicated to consumers.

For instance, we think businesses should have a legal obligation to use all reasonable means to communicate their voluntary recalls and the remedies available to consumers. That is, instead of just publishing a newspaper ad, they should also be advertising on television and social media channels - this is where most people expect to hear about recalls, after all.

You’re correct that there are problems with the way recall information is communicated to consumers - so many people affected never even find out about the recall. Improving this is a priority for CHOICE, and one we’ll continue to focus on through the Australian Consumer Law review process.

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May I suggest that the concept of lemon be extended out to endemic issues with older cars. We have a 10 year old ‘semi-automatic’ Ford Transit which has had 2x major failure of the dual clutch transmission. The first one was some 5 years ago, and the second this year. The earlier one was before I bought the vehicle, but I had the receipts.

When it broke down early this year, I took the vehicle a very large Ford dealership who claimed not to know about the problem. After discussing it with me, they the transmission off to a third party specialist who couldn’t diagnose what the issue was, and therefore was unsure on whether it could be fixed or not. The only other option was a new transmission. They made enquiries, and quoted… wait for it… $28,000 (yes, twenty eight thousand dollars) for a new transmission. (The vehicle was worth about $16,000 running properly.)

When I started Googling the problems, I discovered that this problem was very common, and reported in several models of vehicles here and overseas that had dual clutch system. I also found out that Australia Post and at least one Ambulance service had let contracts to replace these transmissions in their Ford Transits with full automatic transmissions from Holdens.

Eventually, this is what I too did. In total, this recent breakdown cost $9,000, money that we couldn’t really afford, but not running the vehicle was worthless.

It is wrong that Ford will not accept any responsibility for a problem on this scale.

So when thinking about lemons, please consider that some flaws only appear after some years, but are none-the-less flaws in design or construction.

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Hopefully this is the right spot for this.

My Hyundai i30 still has its new car warranty. I’ve now taken it back 4 times for the same very dangerous issue, which is getting worse. It has intermittant starting issues and the engine will randomly stop dead while I’m driving!

The dealer has now replaced the battery and the fuel filters (charged me for parts but not for labour) at different times and it’s still going on. It’s at the dealer for the fourth time now. I’ve asked them to escalate the issue within Hyundai, but they seem very reluctant. They say they will, but they don’t.

While they are being nice as pie to me with free loan cars etc, they seem to have no clue how to fix it and I’m terribly frustrated. I don’t want to drive the car again if the issue might still be there.

Any advice on my rights regarding the new car warranty and how I might go about escalating things if they won’t? What happens if they keep this up and my warranty expires?

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My advice would be to go directly to Hyundai Australia and don’t take no for an answer. Also consider writing to your local motoring editor for the major daily newspapers. They seem to have a fair amount of influence in these matters.. Good luck.

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Oh this is a gripe right up my alley, Car Warranty, in my opinion it is worthless and not worth the paper it’written on! Two new cars, both of excellent quality and world class, one with a hydraulic tappet noise which is not detrimental to the engine, but very annoying and told “The manufacture will not do anything about it” the other had 19 faults some minor and some dangerous. A fly by wire (electronic) operated throttle (accelerator) would lock and the speed of the vehicle could not be increased. An electric steering pump in lieu of the traditional engine driven pressure pump which would stop power assistance at 80kmh. This system would not give the driver any “feel” to what the front wheels were doing, making it seem like control was by a kids game joy stick. Extreme tyre noise into the vehicle making it almost mandatory to wear ear muffs to deaden the noise. Vicious sideways throwing, causing occupants to be jolted sideways making it the worst and most uncomfortable ride ever experienced and as a result is not driven. It seems like there are no springs in the vehicle.

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Hi @ingesrealm,

Lemon cars are a problem that is far too common. Here is our advice:

  • Contact the dealer and the Australian head office of the car company
  • Make sure you put all your communications in writing
  • Mention the Australian Consumer Law and consumer guarantees
  • Mention “major failure”
  • Mention the ACCC and Fair Trading/Consumer Affairs

If this doesn’t work, you may have to take matters further, starting with a report to the ACCC. You can read the full article from @KateBrowne here:

Hang in there, and please keep us updated with your progress.

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Thank you! I’ll let you know how I go.

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I know the I30 is winning all the small medium car sales at $20k drive away right now but I bought one a few years ago and it had a rough crunchy 2 nd gear change that reminded me of the old no-syncro Holden EH I once owned.

Took it back to the dealer several times and even had the Hyundai Regional people out to say “It is within specification” end of story !

I wrote some critical stuff on the Hyundai forum to warn others and bought a new Corolla. haven’t looked back since and never been happier with a car or the Toyota service. I’m not a dealer or employed byToyota.

Hyundai might have won the battle, but I’ve probably got 2 or 3 more new cars to buy in my life and all of friends and family now won’t buy a Hyundai.

Thanks for bringing your problem to air.

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@dogman.obrien Getting a Corolla was a good thing . Toyota build and sell a new one every 37 seconds worldwide according to recently published sale figures .Says so after you Google it so must be right :)) . My mechanic is always harping on me to buy one . Used to have one , great car . Hyundai are a bit patchy on quality control in my opinion . I don’t work for Toyota either but I have worked in vehicle maintenance and serviced a lot of different makes of cars in my time at that job . I have a Suzuki Swift now but I think it will not be long before another Corolla is parked in the driveway . Proven performer .

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@john.coleman2 it must be a mazda if it has excessive tyre noise? Still an on going issue for many successive mazda models. It always surprises me that most other garden variety makes can make cars that are tyre noise free, but in my experience tyre noise complaints come mainly from mazda owners..

@ingesrealm i would say ‘pounds to peanuts’ you have a faulty crank position sensor it is a known reason for intermittent no start condition, random shutoff on many makes and models. it is hard to track down for technicians as it is intermittent and it rarely sets a fault code. there is no rhythm or reason but often heat is a contributor. I would ask your dealer to replace it.

It’s both remarkable and embarrassing that the US has dramatically more stringent consumer protection laws than we do. Lemon laws are a must.

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I bought a Hyundai i30 new in 2010 and it has run well without any problems. Maybe yours was a “Friday” car (or whatever day is “off” in Slovakia or where it was made?)

Many years ago the US Car and Driver magazine had a satire road test of the venerable British Denbeigh Super Chauvinist Mk VII. The difference between the base and the Super was that the Super was built before 10:00 am before the assemblers got tired so that all Supers were symmetrical when viewed from front on. Sadly there does not seem to be a reprint I could find on the internet.

I recall a fiction book around the USA car industry. I think the author was Arthur (?) Hailey but I forget the title, I do remember the car being made- the “Betsy” - and that if disgruntled, a worker would slip a nut into the chassis to give an annoying rattle!

complain directly to Hyundai and see if that gets a response.

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They can’t all be bad. Our i30 diesel is nearly 7 years old, 90 000 km and has not missed a beat. I suppose with any mass-produced product there be some that fail to meet the grade. Good luck.