General Motors cancels warranties on hot cars and trucks that overturn

General Motors begins a new program to prevent rollovers of its hottest models for exorbitant prices.

Low-volume vehicles like the GMC Hummer EV are being resold in staggering quantities as supply doesn’t come anywhere close to meeting demand.

The initial Hummer EV model available this year is $112,595, but many of the paid examples sold for barely more than $250,000, at $324,500 at a recent event.

The automaker will soon launch a $106,395 Chevrolet Corvette Z06 and $149,990 Cadillac Escalade-V and wants out of trouble.

The Escalade V is the most powerful and most expensive Cadillac ever sold. (Cadillac/Fox News)

Steve Carlisle, President of General Motors North America, sent a letter to dealers telling them to cancel the transfer of certain warranties if the buyer resells the vehicles within 12 months of delivery.

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“When vehicles are quickly resold, particularly through non-authorized dealers or other sellers who do not adhere to GM standards, the customer experience is compromised and GM brands are damaged,” the letter says.

Corvette Z06

The Chevrolet Corvette Z06 is a new high-performance version of the sports car. (Chevrolet/Fox News)

Carlisle adds that merchants will also be prohibited from placing orders and reservations on “certain high-demand forms” in the future.

Produced by GMC Hummer EV

GMC delivered only 371 Hummer EV pickups in June as production ramped up. (Emily Elkonen/Bloomberg via Getty Images/Getty Images)

Because of the patchwork of government dealer franchise laws, old automakers are largely barred from charging how much dealers will charge their products, while newer brands like Tesla that sell their cars directly control prices. However, GM’s franchise agreements do include general “best interest” provisions, according to Autoblog.


A GM spokesperson told FOX Business that the bumper-to-bumper drivetrain, electric vehicle powertrain/wheel drive, sheet metal, tires, and accessory covers will be voided on all three models, but clarified that the Hummer EVs’ battery warranty will remain the same.

GM will also continue to cover any required recall work on all vehicles.

The National Automobile Dealers Association did not immediately respond to a request for comment on the policy.

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GM is also trying to address this customer-side issue by offering Corvette Z06 buyers $5,000 worth of MyChevrolet Rewards points, which can be used to pay for things like accessories and service, if they keep the car for at least a year.

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