Aftermarket Professionals Applaud FTC Compliance Warning to Hyundai
By Camille Sheehan
Sacramento, CA / Bethesda, MD / Bowie, MD – May 4, 2018 – On April 9, 2018, the Federal Trade Commission (FTC) issued a “compliance warning” to Hyundai Motor Company regarding violations of the Magnuson Moss Warranty Act (MMWA)’s prohibition against tie-in sales of branded products and services as a condition of warranty coverage. FTC specified the following website statement as problematic: “The use of Hyundai genuine parts is required to keep your Hyundai manufacturer’s warranties and any extended warranties intact.” Should Hyundai fail to eliminate such statements, FTC may take “legal action.”
While AOCA, Auto Care and the Tire Association of America wish that the FTC action had been stronger, we are pleased that the agency has publicly warned the companies that it is illegal under the Magnuson Moss Warranty Act to require the use of a manufacturer part or service in order to maintain a warranty.
The associations had filed complaints with FTC and the National Highway Traffic Safety Administration in 2012 and 2016 over Hyundai and Kia Motors’ Technical Service Bulletins #114 and #12-EM-006 which directed their dealerships to assume aftermarket oil filters were the cause of any engine knocking noise and to refuse warranty coverage associated with oil system maintenance and repairs. Many of the vehicles impacted by those bulletins became the subjects of class action lawsuits (Wallis v. Kia and Mendoza v. Hyundai) and subsequent recalls and settlements which determined the engine knocking noises were the result of engine defects, not aftermarket oil filters or non-dealership service.
The associations hope that the FTC action will serve as a wake-up call to the vehicle manufacturers and their authorized service providers about the Act’s anti-tying provisions; and will also help educate consumers that they can have their vehicles maintained by their trusted independent technician using high quality non-original equipment parts without fear of voiding their new car warranty.
The Automotive Oil Change Association (AOCA) is a non-profit trade organization representing over 4,500 auto maintenance centers throughout the United States, Mexico, Canada and many other countries around the world. The association was founded in 1987 to represent the convenient automotive service industry, and its mission is to provide its members with the business tools, resources and education to professionally and successfully deliver convenient automotive oil changes and other preventive maintenance services. AOCA is dedicated to enhancing the competency of fast lube owners, educating the public about the benefits of preventive automotive maintenance and maintaining a favorable business environment for the industry. For more information, visit www.AOCA.org.
About the Auto Care Association
Based in Bethesda, Md., the Auto Care Association has nearly 3,000 member companies that represent some 150,000 independent automotive businesses that manufacture, distribute and sell motor vehicle parts, accessories, tools, equipment, materials and supplies, and perform vehicle service and repair. Visit www.autocare.org.
About Tire Industry of America
The Tire Industry Association (TIA) is an international non-profit association representing all segments of the tire industry, including those that manufacture, repair, recycle, sell, service or use new or retreaded tires, and also those suppliers or individuals who furnish equipment, material or services to the industry. The mission of TIA is to promote tire safety through training and education, to act as the principal advocate in government affairs, and to enhance the image and professionalism of the industry so that our member businesses may be more successful. TIA has over 10,000 members from all 50 states and around the globe. For more information, visit: www.tireindustry.org.