You buy a brand new car and on the drive home the engine explodes because of a manufacturing defect. The manufacturer will probably fix it by replacing it with a rebuilt engine. And that's perfectly legal.

In 23 years of handling lemon law claims, I have seen virtually every possible automotive breakdown occur to new cars purchased by my clients. Engines explode on the way home from the dealership. Transmissions come apart within days of purchase. Countless other problems have caused breakdowns shortly after delivery. The car goes back to the dealer and the dealer assures the consumer repairs will be performed under warranty.

Based on the number of phone calls I get, I am certain many people are unaware their warranties do not guarantee them a "New" engine or a "New" transmission in the above scenarios. Most new car warranties today promise that the defect which resulted in the failure will be remedied with a repair or replacement of the defective part – at the discretion of the manufacturer. And the replacement part might be a rebuilt or "remanufactured" one. See excerpts of the Honda, Volvo and Mercedes Benz warranties below. I have more but they all say pretty much the same thing.

This concept does not sit well with many consumers. It feels as if their new car is getting a used engine. To many people, this conjures the image of junkyard parts being put into a new car. However, this is not the case.

Factories take major components which have failed - engines, transmissions etc - tear them down and rebuild them. With engines, if the blocks are undamaged, they rebuild them and replace all of the internal moving parts. Parts like alternators and pulleys are reused if they pass inspection. The net result is a factory-assembled engine which will still be covered by the new car warranty. And there is an upside to this: Some auto parts like engine blocks and differential housings actually get "seasoned" with use.

Metal expands and contracts as it goes through the heating and cooling process, and this can be quite pronounced with larger parts like engine blocks and differential housings, especially when they are brand new. After a period of time, the metal will "settle down" and the clearances will become more stable. This is one of the reasons that manufacturers ask you to be mellow with your driving for the first thousand miles or so – the so called, "break in" period.

Advertisement

Advertisement

A seasoned block, in some respects, is preferable to a brand new, unseasoned one. And the same is true for a differential housing. If you had the choice of someone rebuilding the rear-end in your car with a new housing versus them putting in a remanufactured one with a seasoned housing, take the remanufactured one.

There is also a small chance, if the failure occurs early in the product cycle, a new engine or transmission might actually be used. To "seed" the pipeline of remanufactured parts, manufacturers often set aside a few brand new parts. They have to: how else would they fulfill the need for replacement engines before any have had the chance to fail and be rebuilt?

I have spoken to people who demanded a new engine and threatened to sue if they did not get one. Regardless of how you feel about not getting a "New" engine or transmission, there is no legal basis to demand one. The warranty does not obligate them to give you one. Go read your Owner's Manual now. You will find the words "remanufactured" or "rebuilt" used in conjunction with the parts you are entitled to in the case of a major breakdown.

Advertisement

Some people have suggested they wanted their failed engine or transmission repaired rather than replaced. If a major component in your new car has failed in such a way that the manufacturer suggests it needs replacement we can assume the failure was catastrophic. Manufacturers use varying metrics to determine the point at which an engine or transmission is shot but trust me: You're better off with the remanufactured engine or transmission than one which was rebuilt by a dealer. No offense to the dealer technicians in the audience but think about the comparison. Somewhere, the manufacturer has a facility where they are remanufacturing these components on an assembly line day in and day out. The dealership mechanics do not see catastrophic failures like yours on a daily basis. I'd liken this to asking you if you want your heart surgery performed by your family physician who you have been seeing for 20 years or by the heart surgeon you have never met who does a dozen surgeries a week of the type you need?

I know that the above is not ideal but it is the bargain you agree to when you buy a new car. Just keep in mind that it's probably not as bad as it sounds at first. Chalk it up to bad luck and move on. Odds are it won't happen again.

Advertisement

Follow me on Twitter: @stevelehto

Photo Courtesy of 1Futurecars.com.

Steve Lehto is a writer and attorney and has been practicing consumer protection and Michigan lemon law for 23 years. He taught Consumer Protection at the University of Detroit Mercy School of Law for ten years and wrote The Lemon Law Bible. He also wrote Chrysler's Turbine Car: The Rise and Fall of Detroit's Coolest Creation and The Great American Jet Pack: The Quest of the Ultimate Individual Lift Device.