Warranties vital to profits

Time 8:23 am, January 13, 2009

Motor industry support for warrantiesWARRANTIES should be a key area of cooperation between dealers and makers, if vital profits are to be maintained.

Dealers should be able to trust manufacturers to handle claims quickly and efficiency, says motor industry consultancy Forester Grant.

Car makers, in turn, should trust dealers not to submit spurious claims to generate extra aftersales revenue.

‘Warranties are a potential battleground for manufacturers and dealers when money is tight,’ said Forester Grand’s warranty programmes manager Andy Ward.

‘Manufacturers easily become suspicious that dealers are making claims simply to build revenue, especially on repairs such as squeaks and rattles, where there are no spare parts and the job consists entirely of labour time.

‘In turn, dealers often feel that manufacturers drag their heels over legitimate warranty claims, reject too many because of administrative issues and are less than reasonable when it comes to warranty audits.’

What’s the answer? Better attention to warranty handling by car dealers – and better processes from car makers. Trust will build in this approach over time.

Dealers, says Ward, should ensure ‘processes are followed closely, making sure that the right information is included to minimise rejection rates. And car makers should develop clear, easy to follow warranty claim processes.

‘Warranty audits,’ continues Ward, ‘should be seen as an opportunity to examine these processes, and work together to make the whole system function more efficiently, rather than descending into a circle of blame.’

Warranties ‘are vital’

Daihatsu’s 5 year cover

Scheme ups dealer profits

Car Dealer Magazine's avatar

Car Dealer has been covering the motor trade since 2008 as both a print and digital publication. In 2020 the title went fully digital and now provides daily motoring updates on this website for the car industry. A digital magazine is published once a month.

More stories...

Server 190