Car dealers: ‘Lemon law’ may add hundreds to cost of cars

Thursday, April 17, 1997 | 10:55 a.m.

CARSON CITY -- A car dealer from Las Vegas told an Assembly subcommittee that a proposed "lemon law" giving warranties on used vehicles could drive the price up by as much as $650.

Dave Brown, president of the Southern Nevada Independent Auto Dealers Association, said Wednesday the bill would hurt lower-income people who need to buy "as is" cars.

Brown and fellow car dealer Jim Marsh of Las Vegas testified against Assembly Bill 178, which would provide warranties on cars with more than 75,000 miles for a limited time. The bill, by Assemblywoman Barbara Buckley, D-Las Vegas, would either require a car dealer to fix the problems if they were under warranty or the issue could be submitted to arbitration.

The full committee heard testimony Monday from consumers who told stories of engines catching on fire, transmissions dropping out of the cars and the vehicles just plain stopping within days or weeks of their purchase.

The bill was referred to a subcommittee, which held a hearing Wednesday. Buckley said the information presented by Brown and Marsh helped on such issues as requiring a "Bill of Rights" for customers and the problem of salesmen who sell cars without being licensed.

The "Bill of Rights" for the consumer was suggested by Marsh, who said the prospective purchaser should be able to drive the vehicle 100 miles, have the right to take it to his or her mechanic to have it tested, have the car smog tested, look at the service records if they are available, be given knowledge of the condition of the brakes and be told if the car was a "salvage" vehicle.

This would give the consumer a written disclosure document and the vehicle could then be sold "as is" without a warranty.

Brown suggested a law in which there would be a $10 fee attached to every sale to be put in an insurance fund. When the customer had a complaint, it could be settled in mediation and the money in the insurance fund could be used to pay for the repairs, if they were ordered.

There's also a loophole in the bill, Brown said, because it doesn't cover cars under 75,000 miles where the repairs might be more expensive.

Marsh said most cars have major electronic systems. One may sell for $1,595 but if the computer goes out, it could cost $3,000 to repair.

Brown said the bill would be a "hidden tax on the public coming out of the pockets of whose who can least afford it."