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I agree that a new engine replacement (and a free rental) is in order, but the replacing the whole car is a bit out of line. Why should she expect Honda/the dealer to eat the cost of a $35k car over an engine replacement that's $10k tops? I've never heard of a replacement engine significantly affecting resale value, especially if it's a factory replacement done at the dealer. It's not like the car was wrecked or anything.
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