Now that GM is bankrupt, what will happen with your auto warranty? My 1999 Ford Explorer has been a true friend to me. With 150,000 miles on it, it has very little go wrong with it and I’m definitely not one of those people is getting all of that routine maintenance done like the manual that I never read says to do. I’m not very nice to my car but it has hung in there.
Let me give you some of the best parts of my truck: 0 to 60 in about 15 minutes, and if you’re looking for an experience much like one of those vibrating chairs at the mall, take it up to 70 miles an hour. It actually feels good. If I let go of the steering wheel, I’ll find myself in a ditch in seconds and if I’m talking to somebody either on the phone or next to me, sometimes I have to take my foot off the gas pedal to quiet it down.
Yes, it’s a true dream machine but my favorite part about it is the car payment. Zero dollars. While everybody else is paying $500 a month for a shiny new car that can reach 60 miles per hour in less than hour, my $500 is going straight to my investment account.
My time is coming, though. Not far down the road I’m going to need a new car and with GM and Chrysler now bankrupt, my choices may be limited. Or are they? I’m way too cheap to pay the depreciation on a new car so it will most likely be one that is a few years old. It won’t be so old, though, that there isn’t a manufacturer warranty left on it. What happens if I find the perfect car and that car is a Chrysler or GM brand vehicle? Do I still have a warranty and can I get parts?
Since Chrysler and GM filed for bankruptcy, that has been a question on the minds of car shoppers around the country. To answer that question, we have to look at it from two angles. The legal angle and practical angle.
First, the legal angle is that the auto makers would be under no obligation to honor their warranties unless a judge ordered them to do so. The practical angle is much better news. Robert Nardelli, CEO of Chrysler has gone on record stating that Chrysler would honor all warranties and although the GM announcement is only days old, it seems that GM would follow the same path.
The practical angle is more important because we must remember that the idea of bankruptcy is not for a company to never be seen again. Bankruptcy, in most cases is to assist a company in getting back on its feet so the last thing a company wants to is make its customers angry and scare away any potential customers by going back on its word. This can be seen in Chrysler. You may have read the announcements this week that while GM is going in to bankruptcy, Chrysler may be emerging from it. The last thing they want is to further trust issues with the public.
The hard and fast answer to the question of the warranty comes from the federal government. The Obama administration has said that all warranties of bankrupt automakers will be backed by the full faith of the United States government. That is something to hang your hat on.
Every day I get home from work and I say thank you to my Ford for making it through another day. Another day without car payments, another day with minimum insurance coverage and another day without riding in the passenger seat of a tow truck. My day is coming, though and when it does, I’ll still feel good about buying a car from one of the three American automakers if that is indeed the path I want to take.