Consumers Wary of GM Money-Back Guarantee Fine Print
September 22, 2009

It's been just over a week now since GM announced its new 60-day money-back guarantee. The good news is that car shoppers in Edmunds.com's CarSpace forums are talking a lot about it. The bad news, though, is that they don't have a lot of nice things to say.
 
Almost everyone agrees that the promise sounds great.  But, like most savvy shoppers, they're wary of the fine print. Specifically, they want to know exactly how much dough they're getting back if it turns out they don't like that new Chevy Malibu after all. 

GM's own FAQ on the subject attempts to assure that "the customer will receive the purchase price of the vehicle itself after any rebates, discounts, plus applicable sales taxes that were actually paid," but people still have plenty of questions about the details -- such as, "What if it's a financed deal and two payments already came out?" or "What if there was a trade-in involved?" 
 
Others worry that, depending on the state they live in, they may not receive a full refund of the sales taxes they'd have to pay -- potentially thousands of dollars.  And some are put off by a clause in the agreement that states vehicles with more than $200 in damage cannot be returned.  As one member pointed out, "Heck a minor door ding can cost more than $200 to fix." 
 
Given these potential issues, many shoppers say they'd prefer a longer or more comprehensive warranty -- or simply lower prices -- to the buy back program. And those who have caught wind that dealers are offering a $500 rebate to anyone who opts out of the new program say that's what they'd prefer.
 
Of course, the complexity of the program hasn't stopped more than few people from plotting exactly how they'll turn it into a two-month, tire-blistering test-drive of a brand-new Chevrolet Corvette or Cadillac CTS-V. One even wrote up a handy guide entitled, "How To Screw GM Out of Their 60-Day Money Back Guarantee." 
 
In the end, the consensus seems to be that, given the program's likely "hidden" costs, most buyers considering a return would simply say, "Wow, that's a lot of money I'm not getting back... crud. Guess I'll keep it." And even the GM fans in the Edmunds forums fear that this kind of reaction could, in the long run, cause "GM's credibility to suffer even more than it already has."  As one put it, "Do you hate your new purchase enough to spend $1,000 or $1,500 to get out of the deal? Probably not. Will you keep the car and resent the way you were treated? Probably."
 
Still, a few do consider the program a success when considered in a certain light: "If you bought a vehicle and you absolutely hated it you can take a $4K loss by trading it in, or you can lose about $1K in fees, insurance and registration costs." Or: "Virtually nobody will actually use it, so the cost to GM is near zero and it gives them something to market, some positive news." 

Unfortunately, that's not exactly the home run that GM is looking for -- and needs.
 
And that's the word on the street. -- Mark Holthoff, Edmunds.com's manager of Customer Support

Photo by GM

1 - GM's government-appointment chairman Ed Whitacre, formerly of AT&T, stars in the kick-off ads for the automaker's 60-day money-back guarantee program.

Posted by Michelle Krebs at 4:42 AM under Analysis , GM | Comments (6) | digg this | Seed Newsvine

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