Passlock 2?

Transponders are not used in the car's Passlock II system. The Passlock II system uses a circuit built within the ignition switch that introduces a fixed resistance across two wires coming from the BCM during crank and retains that value while the car is running. Some people decide to use a cheap method of constructing a circuit comprised of relays and a resistor. Most people use a more refined method of installing a bypass module to interface with the Passlock II system. Some modules duplicate the resistance value to the car's BCM and others send a data message on the car's Class II data bus telling the BCM that the correct signal was received by the BCM and to allow the car to start and stay running. There may indeed have been no problem with the remote starter install, unfortunately you may never know now. What the shop should have done was to temporarily disconnect the remote starter and return the Passlock II wiring to normal if they used the non-Class II data interface method, and seen whether or not the system faulted. If the problem only occured during remote starting, then there probably was a problem with either the install or the parts used. The Passlock II system in the car is like any ohter component and will evetually fail. I have seen many fail and I have seen many Passlock II interfaces fail, primarily the non-data ones. Your buddy must have approved the work to be done otherwise it is unlawful to do so. The dealer won't hook up the wiring again because they don't know how and don't want to be held responsible it it fails. If the car works fine now, have the shop hook the remote starter up again. They will have to retune it to the new Passlock II resistance value. Make sure they guarantee their work so there is no more problems. Unfortunately, dealers react this way far too often. Sometimes it's warranted and sometimes it's not. You may never know.sparky

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GM does use a chip in the key as you call it on some vehicles. The chip is a transponder and is used by most manufacturers now. GM calls their system Passkey III.sparky