May 31 2019

In 1983, the Texas Legislature passed the Texas Lemon Law to strengthen consumer protections against the involuntary purchase of defective vehicles. The ideological basis for the law was unequivocally sound due to the considerable cost associated with the purchase of new vehicles. When a person invests money into a vehicle, there is a realistic expectation that their purchase comes “as advertised.” In other words, new vehicles should be functional, safe, and free of defects that could potentially limit their value. Moreover, they should meet the standards of the manufacturer warranty.

When a new vehicle that is under warranty shows signs of substantial defects, the Texas Lemon Law statute gives consumers the opportunity for potential relief in the form of a repair, replacement, or repurchase. The Texas Department of Motor Vehicles’ (TxDMV) Lemon Law Section and the Office of Administrative Hearings (OAH) publishes an annual report detailing the latest statistics related to the lemon law rules in Texas. In this two-part article, we will break down the Fiscal Year (FY) 2018 Lemon Law Annual Report.

Facts and Figures: 2018

Since 1993, the TxDMV has recorded a comprehensive report of cases involving the Texas Lemon Law statute on an annual basis. During this time, approximately 18,500 complaints have been filed with the TxDMV resulting in over $120 million in repurchase or replacement value for consumers in the Lone Star State. The most recent figures published by the TxDMV cover the FY 2018, including:

  • Total Texas Lemon Law complaints: 567 (26 percent increase since FY 2016)
  • Total closed Texas Lemon Law complaints: 531
  • Total complaints settled prior to TxDMV final decision: 186
  • Total repurchased or replaced vehicles: 15 (total value: $721,019.19)
  • Total number of vehicles reacquired from a settlement agreement after filing a complaint with the TxDMV: 52
  • Total number of out-of-state vehicles reacquired by manufacturers following repair of ostensible defects: 359

Year-to-Year Results

The lion’s share of lemon law complaints involve passenger cars and light trucks, typically consumer vehicles that are mass produced in factories. The last three years of data highlight an interesting trend related to the Texas Lemon Law. The number of lemon law complaints filed has steadily risen since 2016 (450 complaints) and 2017 (473 complaints), but so has the number of closed ineligible complaints (53, 107, and 181 respectively). In other words, people have become acutely aware of their right to potential relief under the Texas Lemon Law statute, but in many cases they are unable to gain relief since they do not understand the exact parameters for qualification under this statute.

As a result, the number of complaints closed with action has actually decreased every year since 2016, where 391 complaints were closed with action as opposed to 387 in 2017 and only 350 in 2018. Part of this can be contributed to a lack of knowledge about the lemon law rules in Texas. Before you attempt to file a complaint on your own, consult an attorney who has experience dealing with the Texas Lemon Law and other relevant laws to help you ascertain whether or not you qualify for potential relief.

We will continue to break down the FY 2018 Lemon Law Annual Report in part two.

Is your new vehicle spending more and more time in the repair shop? If you would like to speak with us regarding the lemon law rules in Texas, please submit our free case evaluation form today.

Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.