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State Super Warranty Programs Continue to AdvancePosted 1/8/2008By Robert L. Redding, Jr.
New Mexico has joined the ranks of 12 other states with the California clean car-type program. The New Mexico Environmental Improvement Board approved the clean car program for New Mexico. This was done after testimony from several segments of the auto industry including Jerry Burns, AAM, member of ASA's national board of directors, and New Mexico ASA leader Jim Maddox. Despite some interest in the warranty impact on independent repairers, the New Mexico Environmental Improvement Board moved forward. Burns stressed the damage this new regulation could have on the long-term viability of independent repairers. Super warranties inadvertently remove vehicles from independent repair facilities and place them in dealer repair bays. Independent repairers lose not only the warranty work but also any additional repair items. Time availability is becoming increasingly important for Americans. Why would a vehicle owner make two separate vehicle repair stops? There is also the potential of losing the customer for the foreseeable future. New car dealers have filed a lawsuit in New Mexico to block the state from moving forward with the clean car program. In addition to New Mexico's recent action, states that have approved the California clean car program to date are:
Washington state is an example of independent repairers making their voices heard on the warranty issue. The Washington state program does not include the super warranty. Florida Governor Charlie Christ signed an executive order to kick off several environmental initiatives in the Florida. The Florida Department of Environmental Protection (FDEP) is now in the process of holding public workshops regarding the clean car proposal. ASA anticipates a proposed regulation early this year. Charlie Elder, immediate past chairman of ASA, testified at the workshop in Tallahassee, Fla. Elder pointed out that along with independent repairers, consumers also lose with the super warranties. Consumers have less choice in where to have their car repaired, especially in rural areas. While ASA supports clean car programs that improve air quality, it believes they can exist and prosper in states without expanding or extending warranties at the expense of independent repair facilities. Elder concluded by urging the FDEP to evaluate the financial impact on small businesses by implementing the super warranty provision before proposing the rule. One of the issues brought up in Florida had to do with the infrastructure required to run such a program. The number of personnel and the budget for the California Air Resources Board (ARB) was compared to Florida's. States considering a clean car program should also evaluate the costs in reviewing the long-term benefits. Other states considering the California clean car initiative are Arizona, Colorado, possibly Illinois, Utah and Minnesota. Repairers must get involved in the regulatory process for these initiatives as early as possible. Some states have taken the legislative route first but that is not the case with recent initiatives. States have indicated in their programs that they will issue proposed regulations following any additional California clean car program changes. Connecticut outlined this in its authorizing legislation. The threat to repairers with this type of provision can be seen in the California ARB's recent move to expand those items covered by the warranty in California. Its evaluation of the impact on repairers of increased coverage areas included virtually no economic studies. ASA is working with repairers in many of these states as well as others to communicate with policymakers the impact of these super warranty programs. The greenhouse gas portion of the California regulation has been much discussed in the media. The U.S. Environmental Protection Agency (EPA) has California's waiver request under consideration. At the time this article went to press, the EPA's decision on whether to approve or disapprove the waiver for California's greenhouse gas provisions had not yet been made known. A key question will be whether states will have as strong an interest in the zero-emissions vehicle piece of the California program if the waiver is not granted by the U.S. EPA. In New Mexico and in Florida, the number of automotive repairers attending workshops and hearings was very low. This only hurts the efforts of independent repairers. ASA has tried to communicate the issue through the trade press and electronic means. Direct mail is now being used in several of these states to alert all repairers to the rules' implications. Repairers in states with active clean car initiatives are urged to visit ASA's legislative Web site, www.TakingtheHill.com, to learn more about how they can become active on this issue.
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