How long is a car warranty under the Australian Consumer Law?

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This article was originally published in June 2022.

Picture this: eight years into your ownership journey with your beloved hatchback, it loses all ability to steer – apropos of nothing.

Unfortunately, your car warranty expired three years ago.

RELATED: Does Australia need a lemon law? Consumer groups slam dodgy dealers

Are you still covered for free repairs under the Australian Consumer Law, even though the failure happened outside of your manufacturer’s warranty period?

You might be – but let’s explore your rights in more detail.

What is a manufacturer’s warranty?

Every new car purchased in Australia receives a manufacturer’s warranty – a voluntary agreement from a car brand that it will fix or replace certain defective features on your vehicle free of charge, over a specified time period and distance.

Standard manufacturer warranties in Australia typically provide anywhere from three years to seven years of coverage, or from 100,000km up to an unlimited number of kilometres.

Consumers can also opt to pay extra to prolong that coverage period via an extended warranty.

What is covered under my car warranty?

Manufacturers’ warranties don’t cover you for issues that arise with your car as a result of regular wear and tear, but rather tend to apply to mechanical failures resulting from faulty or defective design or parts.

It’s worth reading the fine print for specifics – and make sure you keep an eye out for any payment limits or conditions on included repairs.

Warranty terms and conditions vary by manufacturer, but typically they don’t cover things like cosmetic defects, damage as a result of an accident, tyre or brake pad wear or routine servicing.

For more information on what to look for in a manufacturer’s warranty, read our guide here.

What are my rights under the Australian Consumer Law?

Thankfully, your car purchase is also covered under the Australian Consumer Law, which offers certain guarantees that the product you’ve purchased will work and do what you asked for.

“Manufacturers and dealers must honour your consumer guarantee rights regardless of any commercial warranties they give to you or sell you,” the Australian Competition and Consumer Commission (ACCC) says.

“For example, your consumer guarantee rights may protect you if your car experiences a major failure after a warranty has expired.”

Under consumer guarantee rights, the ACCC says your new car must: “be of acceptable quality (safe, durable and free from defects); be fit for any purpose disclosed before the sale; match the description provided or demo model; and have spare parts and repair facilities available”.

Like manufacturers’ warranties, your consumer guarantee rights are subject to exceptions and, for example, won’t give you coverage if an issue arises from “abnormal consumer use”.

However, unlike manufacturers’ warranties that have a hard end date, consumer guarantee rights apply for an “unspecified but reasonable time”.

Under Australian law, these consumer rights also cannot be “replaced, limited or removed by any agreement, contract or warranty” and cannot be “made subject to non-disclosure conditions”.

That means you’re entitled to these rights whether or not you service or repair your car within a brand’s dealer network.

What happens if my car fails to meet consumer guarantee rights?

According to the ACCC, if your car falls short of meeting the consumer guarantees stipulated above, you have rights against the dealer and, in some cases, the manufacturer – even if your warranty has ended.

“You are entitled to a repair, replacement or refund if your new car fails to meet the consumer guarantees. The remedy you’re entitled to, and who chooses the remedy, will depend on whether the failure is major or minor,” the ACCC explains.

A minor failure is defined as a problem that can be resolved within a reasonable time, like an engine rattle that doesn’t affect the car’s function.

In this instance, the dealer or manufacturer can decide whether to replace, repair or refund your car. Repairs must be conducted free of charge and within a reasonable timeframe, otherwise you are entitled to go elsewhere for the repair and recover the costs.

A major failure is more complicated. It’s defined as: an issue that cannot be fixed within a reasonable time; an issue that – had you known about it – would have prevented you from buying the car; an issue that prevents you from using your car; or an issue that creates an unsafe situation.

This can include things like sudden and major power loss due to a manufacturing defect, or a fault that affects your ability to brake or steer.

If you encounter a major failure with your car, the ACCC says you are able to “reject” the car and choose whether you’d like a repair, replacement or refund.

Additionally, you may also be able to ask the dealer or manufacturer for compensation for any loss or damages you incurred.

What do I do if I encounter an issue with my car outside of my warranty?

Your first port of call should be the dealer that sold you the car.

“The retailer who sold you the product or service cannot refuse to help you by sending you to the manufacturer or importer,” the ACCC says.

“You can approach the manufacturer or importer directly, however, you will only be entitled to recover costs from them, which include an amount for reduction in the product’s value and in some cases compensation for damages or loss.”

If the dealer or manufacturer is not cooperative, there are a number of places to seek help. You can report the issue to the ACCC, but it is unable to resolve disputes and can only investigate areas of concern or identify issues within a particular sector or business.

Other helpful bodies include your state or territory consumer protection agency (see a full list here) or your state or territory small claims tribunal (full list here). It may also be helpful to seek independent legal advice.

MORE: Every new car warranty in Australia for 2022

The post How long is a car warranty under the Australian Consumer Law? appeared first on Drive.

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