Auto Manufacturers and Lemon Law

Good News for Consumers Despite the Bankruptcy of GM and Chrysler

The recent bankruptcy filings of GM and Chrysler have understandably caused many consumers to worry about the existing warranties on their vehicles. Here is the latest information:


While in bankruptcy, Chrysler Motors sold many of its assets and transferred many of its liabilities to Fiat and formed a new corporation known as “Chrysler Group” and is referred to as “New Chrysler”. Fortunately for consumers, Chrysler Group assumed most liabilities on lemon law or warranty claims filed before the bankruptcy. The bankruptcy court stated in the “Sale Order” as follows:

“Notwithstanding anything else contained herein or in the Purchase Agreement, in connection with the purchase of the Debtors’ brands and related Purchased Assets, the Purchaser from and after the Closing, will recognize, honor and pay liabilities under Lemon Laws for additional repairs, refunds (monetary damages) or replacement of a defective vehicle (including reasonable attorneys fees, if any required to be paid under such Lemon Laws and necessarily incurred in obtaining those remedies), and for any regulatory obligations under such Lemon Laws arising now, including but not limited to cases resolved prepetition or in the future, on vehicles manufactured by the Debtors in the five years prior to the Closing. . . .”

Accordingly, vehicles manufactured from 2004 until the present may still qualify for California Lemon Law claims under the law basically as they did previous to the bankruptcy filing by Chrysler. Vehicles manufactured by the New Chrysler will still have warranties provided by the manufacturer and will still be subject to state and federal lemon laws.

If you have purchased a Chrysler vehicle (including Jeep) within the last five years and are experiencing mechanical problems, give us a call. We can most likely still help you with your lemon law claim against New Chrysler and the bankruptcy of the old Chrysler should not affect valid claims.

General Motors

GM filed for bankruptcy protection shortly after Chrysler. However, GM appears to have resolved its outstanding debts through bankruptcy and its business as usual for this auto manufacturer. GM appears to be out of bankruptcy and all pre bankruptcy warranty claims are being litigated with no restrictions for the consumer. If you have purchased a General Motors vehicle which includes GMC, Chevrolet and Cadillac and you are experiencing problems, give us a call. We would love to discuss your lemon problem.


Ultimately, it appears that the bankruptcy filings of GM and Chrysler will have little or no effect on consumers’ ability to file lemon law and or warranty claims against these manufacturers.

This is good news for consumers. Give us a call today at 877-955-3666 for a free consultation or through our Contact Form. We are here to provide you with the representation you deserve for your California Lemon Law Claims.

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Lemon Law Associates Of California represents consumers who have California consumer vehicle claims regarding lemon law and auto fraud.

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Click below where you can find articles that can provide solutions to many of the questions you might have regarding California Lemon Law or if you might have a legitimate lemon law claim.

California Lemon Law FAQs


Q. My car is out of warranty now. Can I
still have a lemon law claim?

Ans: Yes. If you can establish the defect or nonconformity occurred during the original manufacturer’s warranty period your claim may still be valid.