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California Updates Car Recall Reimbursement Rates for Dealers

» Posted December 11, 2019Resources | Share This Post

A new law on the books in California is meant to make it easier for people whose cars have been recalled to actually get their vehicles fixed.

Gov. Gavin Newsom recently signed into law Assembly Bill 179, which changes the rates that car manufacturers must pay car dealers for work on recalled vehicles. The bill was motivated in part by complaints that some dealerships largely limit the recall work that they do. That is because manufacturers pay a lot less for those repairs than dealers charge to other customers.

The California New Car Dealers Association estimates that manufacturers pay as much as 40 percent less for recall work than other customers pay for maintenance and repairs. The association called the bill a “big win.”

Former California Gov. Jerry Brown vetoed a similar measure in 2018, after it was passed by both chambers of the state legislature. Brown said a formula proposed to set rates was too complicated, according to Automotive News.

This time around, the new law allows recall work to be charged at “rates equal to the franchisee's retail labor rate and retail parts rate.”

Legal Rights for California Car Owners

Car recalls are a common occurrence, in California and elsewhere around the world. Unfortunately, a wide range of vehicles come equipped with serious defects that raise significant safety hazards and can be tough to spot.

That is where the California lemon law comes in. The state’s Song-Beverly Consumer Warranty Act requires car manufacturers to perform various repairs on vehicles while they are under warranty. A manufacturer who is unwilling or unable to appropriately repair the vehicle is obligated to buy the car back. That includes compensating the owner for the purchase price and any financing fees, as well as related costs like rental vehicles. There is no set number of repair attempts that must be made before the repurchase requirement kicks in.

The car manufacturer can instead offer to replace the vehicle, but it is up to the owner to decide whether to accept that option. The law also requires the manufacturer to pick up the tab for any legal costs that an owner incurs in asserting his or her rights.

Consult a California Lemon Law Attorney

If you are a car owner or lessor who is haggling with a car manufacturer over repairs, an experienced California lemon law attorney can help. A lawyer can help you weigh your rights and options to ensure that the carmaker is held fully accountable.


At the Bickel Law Firm, we have represented hundreds of clients in defective vehicle cases in Southern California and across the state. We work tirelessly to get the people we represent the compensation they deserve and we have a strong track record of success.


Our offices are conveniently located in Los Angeles, San Diego and San Francisco.  Call us at (888) 800-1983 or contact us online to speak with a California lemon law attorney today.

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"I was having a reoccurring problem with my vehicle that the dealer couldn't seem to fix and when I contacted the manufacturer they were not willing to help me at all, so I contacted the Bickel law firm. This law firm knows what they are doing and will tell you honestly whether you have a case or not. I highly recommend that you give them a try."
Posted By: Rick Mills