This is a quesion I hear a lot of people saying these days in regards to a new car purchase of GM vehicles. With all of the mounting pressure from the Federal Government to get with the program – GM is scrambling to keep consumers happy and purchasing their products. But a huge question that sits in any new car buyers mind is: Will my new auto warranty be voided if GM fails?

In the research that I have done one this topic, it seems to be summed up like this. When a car company such as GM creates an auto warranty, they are creating a legal and binding agreement or contract between themselves and the new car buyer. So if you buy an auto warranty now from them, or get one free with your vehicle which is much more standard, GM has a legal obligation to pay for the car repair bills you accumulate.

With this legally binding contract, the auto warranty, the company is obligated to make good on it’s promise of service. If GM went completly out of business, and no one took them over (AKA the Federal Government), then that would be a whole separate issue. But, if another company bought GM or the Feds decided to run it, which they pretty much are now any way it seems, then that new entiity would have to pay for your car repair bills by way of the auto warranty you bouht at the time the car was purchased.

So, it could really go either way! Here is an interesting discussion I found about the topic on Yahoo Answers.