While these talks about the Lemon Law are good news for Malaysian car owners, they will benefit only if the Malaysian authorities come up with a strong law.
Purchasing a car isn’t just a significant financial decision. People buy cars in the hope that the new cars will make their lives more comfortable, save more time, and make them happier. What if your new car becomes a source of constant frustration and multiple visits to the repair shop?
A car is a complex piece of machine with hundreds of moving parts. No matter how stringent the quality check is, there will always be some faulty cars released for sale. The unfortunate buyers of these faulty cars, then have to visit the manufacturer’s car repair shop multiple times during the warranty. If the faults are too severe, it means that the car owner has to shell out a significant amount of money for repair after the warranty period. Sometimes even during the warranty, the manufacturer might tell the owner that due to the non-availability of parts, the car has to be kept indefinitely with no loaner in exchange. The car becomes a lemon – too faulty to be actually useful.
To address this issue, countries across the globe have ‘lemon laws’ in place so that car buyers are able to get compensation or replacement.
Lemon Law in Malaysia
The sale of passenger cars in Malaysia has been increasing at a steady pace. In 2022, 642,000 units of cars were sold. This figure jumped to 719,000 units in 2023. With such an increase in the number of cars being purchased, it is natural that a percentage of these cars will have manufacturing defects that cannot be easily repaired. Last year, the National Consumer Complaint Centre in Malaysia claimed that it had received a ‘multitude of complaints’ from car owners whose brand-new cars started developing faults within three months of purchase. The consumer has been demanding the implementation of the Lemon Law since at least 2023.
This week, the Ministry of Domestic Trade and Cost of Living (KPDN) has finally decided to go ahead with a feasibility study that would form the basis of Lemon Law in Malaysia. Armizan Mohd Ali, the KPDN minister, informed reporters that after the feasibility study is completed, the ministry will make a policy decision before building a legal framework. The minister, however, hasn’t given a deadline for the completion of the study for the policy decision.
Weak Lemon Law VS Strong Lemon Law
While these talks about the Lemon Law are good news for Malaysian car owners, they will benefit only if the Malaysian authorities come up with a strong Lemon Law.
Lemon Law does not automatically grant buyers the right to replace their defective vehicle with a fresh one or to get a refund. Such consumer protection laws come with various terms. For example, the triggering of the Lemon Law in a country might depend on –
- How long the car owner has to wait for the repair to be completed.
- Whether the defective parts are covered under the law
- The very definition of a ‘defect’
Hence the usefulness of the upcoming Lemon Law will be hidden between the lines.
What a Successful Lemon Lawsuit Looks Like
Countries like the USA and those in Europe have pretty stringent Lemon Laws enabling buyers to get a refund or replacement. Here is a case study of a successful Lemon Lawsuit:
In 2020, a person in New York purchased a Volkswagen GTI 2020. Just 10 months after the purchase, the air conditioning started malfunctioning. And even after 5 repairs, the problem wasn’t resolved. The car was unavailable for repair for a total of 35 days.
The owner – through an attorney – approached the court with the argument that the state’s Lemon Law specifically says that repair attempts for new vehicles (vehicles that are not more than 24 months old and/or haven’t been driven more than 18000 miles) should be limited to four. Furthermore, the claimant argued that the car was unavailable for more than the prescribed limit of 30 days. So much is the power of Lemon Law that the manufacturer restored to a settlement before an arbitration. The claimant received a total of $39,807.59 as part of the settlement.
Buying a car is a significant investment. Ending up with a faulty car does not just lead to real monetary loss, but it also leads to frustration and loss of mental well-being. Malaysian car owners will be hugely benefited as and when the Lemon Law is enacted.