An exasperated car buyer is pressing the Department of Trade and Industry to enforce its 2020 order for a Mercedes Benz dealer to refund the more than P3 million he paid for a car that was found to be defective.
In a decision, the DTI found the luxury car to be defective and held Automotive Icon Inc., the Alabang dealership of Mercedes Benz, liable because it failed to address the car’s brake and suspension problems, which were among the issues raised by the buyer.
The DTI decision on 22 October 2020 ordered Automotive Icon to refund Marciano Ragaza III, president of Travel Enterprise Corp., the amount of P3,090,000 plus the P96,753 he paid for a three-year warranty extension. The dealership was also ordered to pay an administrative fine of P20,000.
Ragaza said that more than two years since the DTI issued the refund decision and more than three years after he bought the defective car, Automotive Icon has yet to refund him.
The case arose from the purchase by the travel executive of a Mercedes Benz C180 Avant Garde from Automotive Icon in November 2019. In his complaint, Ragaza said he noticed that the brakes made a loud and grinding noise and that the car was too bumpy and uncomfortable for a luxury vehicle.
On top of that, he said the gas consumption was not as economical as advertised. It was registering three to 4.4 kilometers per liter instead of the 15 to 19 kms per liter as advertised. Also, he complained that the vehicle was randomly making loud and continuous beeping sounds, the doors did not lock automatically, and the steering wheel made squeaking sounds when making full turns.
Ragaza said he returned to the dealer three days after it was delivered and was told that the issues he raised were normal for the break-in period for the car. Still the problems persisted after one week, so he returned the car to the dealer so the defects could be repaired. The car has been in the Automotive Icon’s possession since then.
After a lengthy series of letters, emails, text messages and telephone calls, Automotive Icon dismissed the imperfections as “within standard parameters relative to its manufacturing specifications.”
Ragaza said he received the same response from Automotive Icon: The noisy brakes and bumpy suspension, among other issues that he complained about, were normal for the car and there was “nothing to repair.”
It was “like telling me it’s natural for a Mercedes Benz to perform as bad as I described it,” Ragaza said in a letter to Automotive Icon.
Exasperated, Ragaza wrote Automotive Icon in January 2020 demanding a full refund, “considering that there was no proper disclosure of the quality of a Mercedes Benz I was buying which is contrary to the reputation of a Mercedes Benz and the ads I have seen.”
When the dealership refused to refund him, Ragaza decided to file a complaint with the DTI for violation of Republic Act 7394 of the Consumer Act of the Philippines.
In its decision, the Adjudication Division of the DTI’s Fair Trade Enforcement Bureau said that “it is clear and evident that the subject vehicle is defective because its imperfections were not properly addressed by respondent Automotive Icon.” It also said that Automotive Icon violated the provision of Deceptive Sales Act or Practices because the vehicle did not have the features as claimed by the dealer and did not perform according to its claims.
Ragaza said that, in February last year, Automotive Icon appealed the DTI decision without submitting new evidence. Just the same, the DTI ordered a third-party testing by the Technical Education and Skills Development Authority.
“To make the long story short, the basis of my complaints were still there and to best of what can be physically determined, TESDA confirmed my complaints,” Ragaza said.
Automotive Icon appealed the findings, again without offering new evidence, to which Ragaza said he responded.
“To this day, we have not heard from the DTI or from Automotive Icon. My money, and the defective car they tried to sell me, have been in their possession since 2019,” Ragaza lamented.
“All I want is to get my money back,” he said.