FTC Warns Hyundai for Magnuson-Moss Violations

The Federal Trade Commission (FTC) on April 9 issued a compliance warning to Hyundai Motor Co. The warning alleged possible violations relating to the Magnuson Moss Warranty Act’s prohibition against tie-in sales of branded products and services as a condition of warranty coverage, according to the Auto Care Association (ACA).

FTC specified the following website statement from Hyundai 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, according to ACA.

“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,” according to ACA in a news release. “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.”