‘Unconscionable’ carmaker in court
The consumer watchdog is suing popular carmaker Mazda over alleged "unconscionable conduct and false or misleading representations" it made to its customers over a number of vehicles.
The Australian Competition and Consumer Commission alleges that several Mazda customers who purchased vehicles between 2013 and 2017 that broke down weren't given enough information about what caused the faults and what Mazda had done to fix them, lied about the severity of faults and fobbed them off to "case managers" who couldn't actually do anything to solve their problems.
Mazda also allegedly told consumers they weren't entitled to a refund or free replacement vehicle when they should have been, offered them less money than their vehicles were worth and then pressured consumers to accept by saying it was a short term and final offer.
Mazda also allegedly snubbed its nose at consumers who wanted the company to refund or replace their vehicle by telling them to sue, although they did at least provide a replacement vehicle to one customer who did.
A few weeks after Mazda recalled more than 35,000 vehicles, the ACCC has announced it will now take its own legal action against Mazda over some of the cars, alleging the company "engaged in conduct that was, in all the circumstances, unconscionable".
"We allege that Mazda repeatedly refused to provide a refund or a replacement at no cost to the consumers and pressured them to accept lesser offers which were made by Mazda only after multiple failures of the vehicles and repeated attempted repairs," ACCC chair Rod Sims said.
The Commission said the carmaker exploited the fact that its customers were in a "substantially weaker bargaining position", pushed customers back into defective and unsafe vehicles that weren't fit to drive, and was still refusing to provide refunds or replacements to consumers.
"As a result of Mazda's conduct, the consumers suffered economic and non-economic
harm. This included inconvenience, distress and frustration about not being able to use
their vehicles for substantial periods of time, having to endure protracted negotiations with
Mazda Australia and attempted repairs to their vehicles, and being refused any
adequate remedy for the issues they experienced with their vehicles, as well as being
required to make a significant payment in order to obtain a replacement vehicle," the ACCC said in a statement filed in the Federal Court on Wednesday.
In one instance, Mazda failed to fix a fault on a customer's Mazda 2 hatch approximately seven times in two years, which the customer said made them uncomfortable driving it, but continued to do so because they needed it for work.
A month after the last attempt at repairing, the customer was driving at high speed down the highway when the car lost power. It was then towed to a dealer, who "forgot about it" for three weeks.
After the Mazda 2 had been at the dealership for two months, the customer contacted Mazda to say they felt uncomfortable driving it and that it was a "ticking time bomb".
Because they needed the vehicle for work and couldn't afford another, they continued to drive it after Mazda eventually "fixed" the vehicle.
A few months later it lost power again.
When the customer didn't want it back they were eventually pressured into accepting $13,000 for the vehicle they'd paid $19,000 for a few years earlier.
Another customer who couldn't drive their Mazda CX-5 at night because the adaptive headlights continually failed chased Mazda through the NSW Civil and Administrative Tribunal (NCAT). The carmaker eventually had their vehicle replaced with a new one, which was delivered two weeks after the agreed upon date.
Another CX-5 customer was returning from an interstate holiday with their children when their car lost power at speed on the highway.
The car spent four weeks at the dealership to have its engine and radiator replaced, though this was never adequately explained to the customer.
Their CX-5 lost power on the motorway twice more, amid other problems with the engine that Mazda tried to charge the customer $23,000 to fix.
The case eventually found its way to the NCAT, but the customer didn't.
As they were driving to the hearing, the cabin of the vehicle began filling with fumes and they took it to a Mazda dealer, saying they rejected the vehicle because it was unsafe to drive and the attempted repairs had failed to fix the myriad of problems the car had.
The two parties eventually settled the matter for $16,000, $27,000 less than they'd paid for the car around five years earlier.
Mr Sims said the new car industry is "squarely on notice" of the concerns the Commission has and it will continue fighting to ensure consumers get the rights they're entitled to.
"Consumers do not have to make any financial contribution to receive the remedies they are entitled to under the Australian Consumer Law," Mr Sims said.
"The ACCC remains alarmed about the barrage of issues consumers face when they attempt to exercise their consumer rights because there is a problem with a new vehicle they have purchased."
The Commission is taking Mazda to court seeking penalties, declarations, injunctions, consumer redress, a publication order, and an order requiring the implementation of a compliance program.
It also plans to have Mazda pay for it to do so as well.
Mazda has yet to file a defence to the claims.
Have you been subjected to "unconscionable conduct" by a car dealer? Let us know in the comments below.