Carpocalypse: What's It Mean for Me?

Saturnvue

Here's the scenario: The deals on domestics were great in January, so you picked up a shiny new Saturn. Or a Hummer. Now you're feeling a little nervous: What about my warranty? What's going to happen to the resale value of the car? Can I get parts? Here are some answers.

Q. I just bought a new Saturn/Hummer/Pontiac and I hear they may kill off the brand. What happens to my warranty?

A. Your warranty is a contract between the automaker and you. Even if the nameplate goes away, GM (or whichever automaker it is) is still on the hook for upholding the terms of that warranty. Now, if the automaker files for bankruptcy, it could be a different game. In that case, you might have to get in line with all the other creditors (bondholders, suppliers, etc.) to get your warranty paid off. Or, the bankruptcy court could make provisions to set aside enough money to pay any warranty claims. But for now, your warranty should remain valid.

Q. Will owning a discontinued brand hurt how much I can get when I try to sell it down the road?

A. Possibly, and maybe even probably. Used-car shoppers would likely be leery of a car from a discontinued brand, fearful that getting parts would be difficult and that there would be no dealer support for maintenance issues. That being said, GM cars often share platforms, so many of the Saturns and Pontiacs that might go away would have siblings that use similar, if not the same, parts. For late-model cars it wouldn't be a problem, but for older cars it would definitely give pause.

Q. When will I know what's going to happen to my automaker?

A. The Obama administration has a March 31 deadline to decide if the GM and Chrysler overhaul plans are viable. If it doesn't think they are, it has the authority to call back the money that's already been lent to the two automakers. Chrysler, for one, has said that would lead to a bankruptcy filing, which could lead to liquidation, according to the plan it filed yesterday. It's too early to tell how the Obama team will decide on these two plans.

Q. Is it a good time to buy a car from one of these on-the-bubble brands?

A. It could be, if you have one in mind that meets your needs and you can get financing or, better yet, pay cash. Cars are generally more reliable than they've ever been, and there's enough inventory out there right now that you can get some really good value for your money. Of course, there could be risks, but if you plan to keep your car for a long while (which means the depreciation issue is less of a concern for you), then there might not be a better time to act.

By Patrick Olsen | February 18, 2009 | Comments (17)
Tags: In The News

Comments 

Brad

One would have to be a complete idiot to buy anything from GM or Chrysler. A car is a depreciating asset, figure in the high risk associated with both companies and you may as well flush another 20-40% of your money down the drain. A smart person would buy a slightly used Honda, Toyota, Hyundai, Subaru, etc. If you are buying new you would be insane to buy from GM or Chrysler.

But Brad, if you're the type of person who drives a car into the ground getting huge cash back deals on a new GM or Chrysler could save you in the long run. Someone said they got $9K off a Caravan! that'll save your family a lot up front and if its reliable (knock on wood) the resale in ten years won't be a big issues. Again, its for the people who hold on to cars for a long time. I would definitely advise people its ok to buy a GM car. We don't recommend many Chryslers however.

I should also mention, you should be getting good deals on any car these days, just bigger incentives from troubled brands.

Tony

part shouldn't a problem. Aftermarket will be happy to be the only supplyer.

ed

GM please listen to me. Combine Saturn with Pontiac and call them Opels. Leave the G8, Vibe, VUE, Sky/Soltice (rename it GT), bring the Meriva and Corsa or Agila. Also bring the Astra sedan and convertible. Bring Opels!!!!

Trainer

That's all we need to bring back memories of the horrible Opel Kadette, the stupid Opel Manta and all the other crappy Opels that were sold through Buick dealers. That idea didn't work the first time and certainly won't now, unless they've drastically improved their substandard quality. The monumental problems with the Opel based Cadillac Catera indicate not much has changed.

d

the Opel Insignia is worlds better than alot of american cars....inc. the Chevy Malibu!! The Chinese get it as a Buick Regal!

Trainer

D, have you driven the Insignia or owned one? If not, you have no basis to say it's better. People said the same thing about the Opel-based Catera - that it was better than any U.S. luxury car. The reality was it stunk and word got around fast so they had zero resale value. The Insignia is a beautiful design, but Opel's track record makes me skeptical.

ddb

"...If it doesn't think they are, it has the authority to call back the money that's already been lent to the two automakers. Chrysler, for one, has said that would lead to a bankruptcy filing..."

I resent that the management of large companies would deflect responsibility for their fate by essentially forcing the govt to act as its CEO. They have pushed decisions that should be made by (supposedly) informed leaders of the industry onto an organization that cannot operate with a profit motive.

...and now we will have politicians determining if this industry will survive, and if so, how it will be run.

Thank you big business. Those who are far less informed than you must now make the untimely decisions you were too scared to make (but still got paid for).

I'm usually not this bitter...

d

yes i have driven one, i recently went to Germany! I've rented Fusions, Malibus, Impalas....& yes the Insignia is years better! What Opel track record r u referring 2? One car? The Omega wuz good as an Opel, not so good as a Caddy!

Great info. Thanks for enlightening me regarding warranty issues. I hope my dealer won't declare bankruptcy just to escape from their obligations.

.

That's why they badge engineered just about every vehicle. Someone at the top has a vision of the future!

johnnyt

well d and trainer, the vue, astra, and sky are all sold (and sell very well) as opels in the EU. the vue and astra were opel products before they were anything else. a car that is sold somewhere else, even though it is the same car, can not be held on it's own to be a good fit for the american market. it doesn't count here until it's really sold here - case in point, the catera/saturn l-series.

dj

keep cadilac (for premium) an chevrolet (for mainstream) get rid of the rest of the brands.

.

Comparing the Insignia to what? Fusion? Malibu? Impala? The Insignia has to be the best out of those incompetent bunch!

SG

awww, What ever happened to the years where Saturn Dealers literally ran out of inventory?

Saturns have always been appealing to me until they started to mainstream them with other GM vehicles... "Different Kind Of Car Company, Different Kind Of Car." what happened to that slogan?

I really hate to see Saturn go but i guess thats what we get for letting Money Hungry people run organizations.

Blake

Why don't they axe Buick? Biggest waste of a car ever. And why bother with the GMC brand? Nostalgia? It's not like anyone buys the GMC branded cars anyway. I think that Pontiac and Saturn both have potential (performance cars, cheap cars) but need to be reworked to what they were intended. But, of course, all this is why GM is going under.

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