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No dealer would give her a new car. Most dealers would, however, offer an engine replacement. Many states is the U.S. have lemon laws, but they only last for days and at the most, weeks. This situation would not fall under a lemon law because presumably there is nothing wrong with the car. It is more likely this situation would fall under some sort of dealer negligence, which your friend would only be able to pursue if she were to sue.
What your friend needs to decide is how much money she is willing to pay for a new car. If your friend hires a lawyer (which costs money), it is most likely that the dealership will change it's stance. (although I don't have a vast knowledge of Canadian Law) this would probably not make it to a court. The dealership would probably settle. What that settlement is however, could just be a new engine and a year of free oil changes, as someone said above. Or it could be a new engine and free oil changes for the lifetime of the car or it could be a new car. Unfortunately, the only chance she has of getting a new car is through a lawyer.
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