Yes, if the vehicle is repossessed and there is a deficit between the sale and the loan balance, (including fees and penalties)and the borrower cannot pay what is owed.
It is more likely the car will be repossessed by the lending agency, if you have defaulted on the loan. You may also be charged criminally. If you simply took a car without paying for it, this is classified as grand theft auto and, if caught, you will be charged criminally.
It does not matter if you don't have the car any more. What matters is the unpaid loan you took out on it when you bought it. It is because of the loan, not the car, that you are being sued. You can try re-negotiating with the car dealership and with the financial company. If that fails, you can try to hire a lawyer to protect your interests.
The Attorney General
Yes. If the signer defaults on the loan, then you, as the cosigner, would be liable.
Broke, sued, socially ostracized, deceased.
Call the loan company and try to work with them. Next step is you loose the car.