The inside scoop on your vehicle warranty


Some insider info on your vehicles warranty.

As with all things, vehicle warranties are only as good as the system that manages them.

I have experienced on multiple occasions where a customers vehicle develops a problem that should be covered under the manufacturers warranty. These scenarios that I am talking about here all had issues with oil leaks, and were nearing the end of their warranty period.

For example,

A new client of ours was driving around and thinking about the warranty on their vehicle that is nearing its expiration date. They were pleased with their vehicle and seemed to nothing wrong, but they wanted to be sure that nothing needed to be dealt with while the manufacturer will pay for it.

They booked their vehicle in for an independent, “Pre-warranty expiry inspection”, with us and our technician identified an oil leak developing that would most definitely be covered within the manufacturers warranty.

They have been following the manufacturers maintenance schedule, and, up until now they have been using the dealer for service (as a means to uphold their end of the warranty obligations, or so they thought). Our client couldn’t help but wonder; “why has this never been brought to my attention before?”. Let me shed some light on this for you.

When the system fails you.

Auto dealers are managed in part by the manufacturer; to be sure they are operating within franchise obligations and upholding the brand requirements. Service departments are under heavy scrutiny when it comes to their volume of warranty claims. What this means is they are frequently audited throughout the year for their number of claims, and the costs to the manufacturer associated with those claims.

For example, if there is a particular engine design that is “flawed”, in the sense that they are prone to oil leaks. The manufacturer recognizes the volume of these repairs developing from a particular dealer; they then pay that service department a visit to review their practices.

During the auditing process it is identified that the service department is over their “quota” for this particular warranty repair and are to reduce the number of claims they submit for this issue. The problem is, there are still hundreds of vehicles under warranty with the same engine design having issues. How can they stop that form happening? They can’t. Instead, what they can do is, “not notice” the leaks if the customer has not complained about them. In other words, they won’t bring the fact of the leak forward during regular servicing, meaning they won’t notify the you.

I was on a call to a service department on behalf of one of our clients recently, and was told from the service manager himself; “we are told not to mention the leaks during regular service in hopes that the leak will not be recognizable to the customer until the warranty expires”.

Are you kidding me?

But wait, there is more…

There is a second force at play here. Technicians at the dealer are paid by a “Flat Rate” system. For warranty work the manufacturer pays approximately 50% of the time compared to an off-warranty repair. Meaning the technician would only be paid half as much doing the same job if it is off warranty. Why would a technician, when they can see that the warranty expires in three months, mention an oil leak when they are servicing your vehicle? They most likely won’t, because of the system they work within, and it is more financially beneficial to them to wait until the vehicle is off warranty.

I hear so many people say, “My vehicle just came off of warranty and now it has problems”. Well, unfortunately, the problems most likely have been there all along, and you were not told of them.

It is your choice where you service your vehicle, even when it is under warranty. It is a great idea to have an unbiased set of eyes look it over regularly.

We have access to un-published technical service bulletins and warranty extensions that we review each time your vehicle is in for service, or repair.