Cadillac Voids Warranty After Escalade-V Owner Refinances Car

Industry News / 30 Comments

Not the kind of service you'd expect after dropping $150k.

A Cadillac Escalade-V owner has apparently voided the warranty on his car after refinancing it at a lower interest rate.

According to GM Authority, who spoke directly to the customer involved, the V was purchased in September 2022 via GM Financial. The customer then refinanced the vehicle at a lower interest rate with a different unnamed company. There was no need to change the title, as the car remained in the hands of the same person.

Shortly after, the customer experienced a loss of power and received a "Service 4WD" message on the instrument cluster. The car was booked in at the local Caddy dealer, where the customer was informed of a warranty block on the vehicle. As a reminder, the Escalade-V comes standard with a four-year/50,000-mile limited warranty and a six-year/70,000-mile powertrain warranty.

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The price above is before a dealer puts a decent markup on it. We only mention the dreaded industry markup because it sits at the core of this sordid tale. As you might know, Cadillac has received a lot of negative press for dealer markups and car flippers trying to make a quick buck out of high-profile cars like the Corvette Z06, GMC Hummer EV, and, obviously, the Escalade-V.

GM started with a stern letter, then a reward system for not selling a car within 12 months, but eventually went for the nuclear option by canceling the warranty and denying access to future high-demand products if an owner flipped a vehicle within 12 months. The period was later dropped to six months.

This didn't stop flippers from doing their thing, but internet outrage seems to work on dealers.

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Technically, the owner is in breach of the rules above, but also not since the title didn't change. The Escalade-V did not change hands, and the owner certainly did not flip the car to make a quick buck.

Still, the warranty claim has been denied. According to GM Authority, it has been a little over a week, and the customer is still waiting for feedback from the dealer and GM. The dealer states that the warranty is blocked to non-retention, which is not the case.

This reflects poorly on GM, especially since this particular customer purchased the most expensive car it currently produces. Not that price matters. This would be considered poor form even if this customer was struggling with a $22,000 Chevy Trailblazer. It also seems like a problem that can easily be solved via a 15-minute phone call.

GM does have a right to reply, and we have reached out for comment on the situation. We will make sure to update the article accordingly.

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