SENATE BILL REPORT

ESHB 2430

BYHouse Committee on Commerce & Labor (originally sponsored by Representatives P. King, Vekich, Walker, Prentice, Winsley, Jones and Kremen; by request of Attorney General)

Revising provisions for motor vehicle warranties.

House Committe on Commerce & Labor

Senate Committee on Economic Development & Labor

Senate Hearing Date(s):February 12, 1990; February 19, 1990

Majority Report:  Do pass as amended.

      Signed by Senators Lee, Chairman; Anderson, Vice Chairman; McMullen, Saling, Smitherman, Warnke, West, Williams.

Senate Staff:Jonathan Seib (786-7427)

                  February 19, 1990

AS REPORTED BY COMMITTEE ON ECONOMIC DEVELOPMENT & LABOR, FEBRUARY 19, 1990

BACKGROUND:

In 1987, the Legislature made substantial changes in the law governing enforcement of warranties on new motor vehicles (the "lemon law").  The lemon law specifically exempts from its coverage vehicles purchased or leased by a business as part of a fleet of 10 or more vehicles, larger trucks, and motorcycles.

One provision of the lemon law allows the consumer to receive a replacement vehicle or to have the manufacturer or dealer repurchase the vehicle, if a manufacturer or new motor vehicle dealer is unable to conform the vehicle to the warranty by repairing or correcting any nonconformity, after a reasonable number of attempts.  In the case of a replacement, the consumer must pay to the manufacturer a reasonable offset for use.  In the case of a repurchase, the manufacturer must refund the purchase price, all collateral charges, and incidental costs, less a reasonable offset for use.  The reasonable offset for use is computed by multiplying the number of miles that the consumer was responsible for putting on the vehicle times the purchase price, and dividing the product by 100,000.

SUMMARY:

New motorcycles that have an engine displacement of at least 750 cubic centimeters are covered by the lemon law.  The exemption for vehicles purchased or leased by a business as part of a fleet of 10 or more vehicles and the exemption for larger trucks are also removed.

The reasonable offset for use for a motorcycle is computed by multiplying the number of miles that the vehicle traveled before repurchase or replacement times the purchase price, and dividing the product by 25,000.

The definition of "manufacturer" is amended to clearly exclude any person engaged in the business of set-up of motorcycles as an agent of a new motor vehicle dealer who does not otherwise construct or assemble motorcycles.

SUMMARY OF PROPOSED SENATE AMENDMENT:

Vehicles purchased or leased by a business as part of a fleet of 10 or more vehicles and trucks with 19,000 pounds or more gross vehicle weight rating will remain exempt from the lemon law.

Appropriation:    none

Revenue:    none

Fiscal Note:      available

Senate Committee - Testified: Mike Grant, Dick Hubbard, office of the Attorney General; Norm Proctor, PACCAR, Inc.; Jim Austin, Motor Vehicle Manufacturers Association