Retail

Associations ask FTC to take action against KIA

Posted on May 28, 2014

The Auto Care Association, Automotive Oil Change Association, Service Station Dealers of America and Tire Industry Association joined forces to call on the Federal Trade Commission (FTC) to take immediate action to have Kia Motors America Inc. withdraw a technical bulletin warning consumers not to use non-OEM filters, which is clearly a violation of the Magnuson-Moss Warranty Act (MMWA).

The bulletin, which was referenced in an article posted by Consumer Reports, recommended that car owners either go back to the authorized dealer or use a Kia oil filter to avoid problems with oil- and filter-related warranty claims.

Two years ago, the four associations submitted a complaint to the FTC regarding a technical service bulletin from Kia that authorizes dealers to deny warranty coverage simply based on the use of an aftermarket filter without any determination that the filter actually caused the problem with the vehicle. The letter pointed out that this practice is clearly a violation of the MMWA. Specifically, the letter stated:

The MMWA manufacturer’s burden of proof is not that it need merely show an aftermarket part “relates” to damage, but that it “caused” any alleged damage. As the FTC states in its consumer alert: “The Magnuson-Moss Warranty Act makes it illegal for companies to void your warranty or deny coverage under the warranty simply because you used an aftermarket or recycled part.”

The alert goes on to say that if there is a problem with use of an aftermarket part or how it was installed, the manufacturer or dealer may deny a warranty claim. However, the manufacturer must first “show that the aftermarket or recycled part caused the need for repairs before denying warranty coverage.”

Kia’s directives circumvent this process entirely: the mere presence of an aftermarket oil filter automatically voids warranty coverage for the oil change parts and services as well as any damage Kia says “relates” to oil filter function.

The May 27, 2014, letter to the FTC states, “Despite the complaint, the FTC has yet to do anything to enforce the MMWA requirements with Kia. Now, Consumer Reports (CR) is further promoting the Kia technical bulletin in an article that has been seen on the Yahoo’s front page, as well as other locations. If there was any doubt about how the technical bulletin is being interpreted by consumers, one only needs to read the recommendations from CR for motorists with Kia vehicles under warranty.”

The Consumer Reports article states:

* When dropping your car off for service, make sure you don't authorize the dealer to perform repairs without speaking with you first. This way you won’t get a surprise bill for an oil and filter change.

* If your Kia is still under the powertrain warranty, considering taking it to the dealer for oil changes. Yes, it probably costs more than the quick-lube store, but you’ll avoid any potential problems with oil- and filter-related warranty claims.

* Consider buying Kia-approved oil filters and either using them when you do your own oil changes, or have your mechanic or quick-lube store use the Kia filter and not their own.

The letter to the FTC also states, “Note that CR is specifically recommending that car owners either go back to the authorized dealer or use a Kia oil filter in direct contravention of the consumer options codified in MMWA. To arrive at that recommendation, the report perpetuates Kia’s sleight of hand regarding the manufacturer’s burden of proof. In Kia’s world, and now CR’s as well, it is the consumer who must prove that an aftermarket filter didn’t cause engine damage, which is exceptionally handy for Kia given their failure to establish a technical basis for their proprietary filter mandate.

“The main loser of course is the consumer who, as the CR article states, must now pay more for an oil change. While CR clearly should have done more to research this issue before publishing the article, the fact remains that the FTC failed to undertake its responsibilities under the law and take action to halt Kia’s anticompetitive and anti-consumer actions. The absence of action by the Commission is now cascading, as evidenced by the CR posting, into additional misinformation to consumers and subsequently more harm to Kia owners and to those who service and supply parts for Kia vehicles.”

For more information, see www.autocare.org, www.aoca.org or www.tireindustry.org.

Related Topics: Auto Care Association, Automotive Oil Change Association, FTC, Kia Motors America, Magnuson-Moss Warranty Act, Service Station Dealers of America and Allied Trad, Tire Industry Association

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