Arlington, VA – The American Consumer Institute’s (ACI) analysis finds that S3309/A4380, would impose unnecessary costs on consumers and allow unsafe vehicles to be sold without necessary repairs.
In a letter to the New Jersey State Legislature, ACI highlighted two major concerns:
- Higher Car Prices for Consumers – The legislation would force Original Equipment Manufacturers (OEMs) to overpay dealerships for warranty compensation—by as much as 1.5 times the standard rate—without any data to justify the increase. ACI’s research shows that similar state laws have already added nearly $48 billion in extra costs for American consumers, with the Federal Trade Commission estimating new car prices rise by about 7.8 percent due to such dealership protectionist policies.
- Consumer Safety Risks – The bill would allow dealerships to sell vehicles with known defects and recalls as long as the information is disclosed. However, this disclosure could be buried in paperwork, hidden in a foreign language, or otherwise overlooked, putting unsuspecting drivers at serious risk. ACI points to real-life tragedies where consumers lost their lives due to unaddressed vehicle recalls—accidents that could have been prevented with proper safeguards.
Read the full comments below.
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