New ways to squeeze service from 'lemon' cars

It looks like a car but it acts like a lemon.

There was a time when new car owners had to learn to make do or plead for help when their vehicles had manufacturing defects that repeated repairs would not resolve. Now manufacturers themselves often issue recalls and the number of options for handling problems is growing rapidly. Indeed, it is getting harder to know which avenue to take.

Experts in the field do agree on the first step. Owners should take their complaint back to the owner or service manager of the dealership that sold them the car. But the way you do it, experts say, can make a difference.

''If you can cool down, be polite, and try to at least rationally discuss the problem rather than argue it, you've got a 50-50 chance to get it resolved,'' says Richard Matysiak, chief automotive investigator for the Office of Consumer Affairs in Atlanta.

If, however, two or three return visits yield no results, you may want to consider mediation or arbitration of the dispute.

To keep from forfeiting the right to eventually take the case to court and recover damages, search for an approach that will not make the solution binding, suggests Clarence Ditlow, director of the nonprofit Center for Auto Safety and a man who estimates that at least one of every 1,000 new car owners drive a lemon. His organization was founded by Ralph Nader 12 years ago in Washington, and is now independent. Recently, in Chicago, the group conducted its second annual training session for lawyers on car warranty law for ''lemon'' cases which end up in court.

Several manufacturers, such as Chrysler and Ford, offer their own independent third party appeals boards. Most of these were started a few years ago on a test basis, and have not yet expanded to many states.

The chief manufacturer-supported dispute mechanism is a service offered by the Council of Better Business Bureaus (BBB). According to vice-president Dean Determan, the council's service is rapidly expanding state by state. Both General Motors and Volkswagen of America signed contracts last year with the council, accepting its arbitration decisions as binding. Under the council plan, the consumer must also accept the verdict. That, in Mr. Ditlow's view, is one of the program's chief drawbacks.

The key dealer-sponsored mechanism for resolving car disputes is called AUTOCAP (for Auto Consumer Action Panels), which has handled about three times as many car complaints as the BBB. Most import manufacturers and the American Motors Corporation are also cooperating in this venture. Decisions are binding on the industry but not on consumers. However, the 35 panels that now exist do not cover the country (there are few in the Midwest, according to the National Automobile Dealers Association).

Georgia's Mr. Matysiak, who has served on an AUTOCAP panel for three years and was in Chicago for the seminar, finds it illogical that manufacturers and dealers cannot agree on one mechanism to resolve car complaints. He points out that AUTOCAP panels have not been highly successful in his state.

''I'm not saying that AUTOCAPS can't work but that manufacturers have to participate with dealers,'' he says. ''There are only certain things that the dealer can correct and it's not fair to put all the blame on him.''

Some consumers who have been less than satisfied with the results from either direct action with dealers or arbitration efforts have moved their cases to small claims courts or to civil courts.

An Alabama man had taken his station wagon back to the dealer for repairs 30 times during the first year. He had to buy a new fuel pump, new engine block, new carburetor, and new piston rings. Still, he only got eight miles to the gallon and the wagon burned oil by the case. An Alabama court eventually ruled that the dealer must refund the down payment, the value of his trade in, and all his monthly payments.

The seven-year-old Magnuson-Moss Warranty Act encourages consumers to take their case to court by allowing judges to award attorney fees separately from any compensation to the consumer. But in training lawyers to gear up for the job , Mr. Ditlow says his aim is to deter rather than increase the number of cases going to court.

''You have to have a credible threat,'' he argues. ''If the manufacturer knows you're willing to sue, he's going to be more likely to negotiate a complaint. It used to be that manufacturers would say, 'If you don't like it, you can sue us.' Now they're saying, 'Please don't sue us.' ''