What does a discount on a new vehicle actually cost you? As it turns out, it may cost you your rightful day in court. Each of Detroit’s Big Three automakers offer an employee “friends and family” discount on new vehicles, but only one, Fiat Chrysler, requires those using the discount to give up their constitutional right to a jury trial in return for saving a few hundred dollars. Rosemary Shahan, president of the Sacramento advocacy group Consumers for Auto Reliability and Safety, had this to say, “This discount is like the piece of cheese on the trap that kills the mouse.” Although arbitration clauses are prevalent in consumer contracts today, Chrysler is taking it to another level by attempting to incentivize and encourage consumers to forego their constitutional right to sue.
Chrysler uses a Group Employee Advantage form, in addition to mounds of other paperwork, that contains a fine print arbitration clause stating that in return for the discount the buyer “will not be able to bring a lawsuit for any warranty disputes relating to this vehicle” and will instead agree to “mandatory arbitration.” The form says at the top that it is for a “Friends and Family” program. The buyers don’t know they are taking part in any such program. To make matters worse, dealers rarely, if ever, point out to their customers that they are signing away their right to sue the manufacturer in exchange for a couple hundred dollars.
Instead of being able to file suit in the courts, consumers will be forced to arbitrate with an arbitrator chosen by Chrysler, in a forum chosen by Chrysler and under rules written by Chrysler. Before agreeing to any of the offered discounts, especially when buying a Chrysler, Dodge, Jeep, or Fiat, I would suggest that you decide if you really want to give up your constitutional right to a jury trial in the event you later find out you have a vehicle with a serious safety defect and need access to the courts.
Sources: The Consumerist and L.A. Times