A guide to what vehicle warranties can and cannot do for you:- Mtbr.com
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  1. #1
    RIS
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    A guide to what vehicle warranties can and cannot do for you:

    FWIW- this will be a series of posts that I will update as I have time:



    Before we begin, I need to warn you that you may have difficulty understanding this subject if you're not able to grasp these three things:

    1) The only time that something came from nothing was when God spoke it into being.

    2) The only perfect man to ever walk the face of the earth was Jesus Christ.

    3) Car salesmen lie.

    Well, here we go:

    When a manufacturer makes a product, they understand that none of their employees are perfect (refer to point # 2 above). That means that from time to time, there will be mistakes made. Most companies do the best that they can, but mistakes can and will happen.

    It is generally bad for business if they didn't have a way of dealing with those mistakes, because consumers would lose confidence and stop buying their products, and the business would quickly fail.

    That way of dealing with mistakes is called a "warranty". Only the manufacturer can warranty a product. Nobody can modify the terms of the warranty except for the manufacturer. It's not something extra that you buy (we will cover "extended warranties" later). A warranty gives the consumer a reasonable amount of time to discover any defects and present them to the manufacturer (via his agent, the dealership, in this case), for repair, at the manufacturer's expense.

    The reason that warranties all eventually end, is that at some point, YOU need to take ownership of YOUR car.

    So as you can see, a warranty is not intended to immunize you against all adverse aspects of vehicle ownership. After all, YOU own the car, not them. And if YOU do something to YOUR car, it's only fair that YOU should pay for it, instead of going whining and *****ing to try to find someone else to pay for it.

    And if we refer to point # 1 above, you'll quickly understand that the costs of the warranty are built into the cost of the product. So to be real clear, a warranty is not something that Santa brought. It's not getting something for nothing, and it's not there to protect your interests, it's there to protect the manufacturer's interests.

    Car salesmen will generally say anything they think that they have to in order to get you to buy a car right now (refer to point # 3 above). For example: You may be shopping for a pickup and want a lift kit. The salesman doesn't want you holding back $3500 of your money for a lift kit with oversized wheels and tires- he wants to drain you of every last penny he can get. So he tells you that if you buy the truck and take it somewhere else to do the lift kit, that it will void your warranty, but if you pay him $7000 for the same work, that you can finance it as part of your car loan, and since the dealership did the work, that the warranty will cover anything that happens. The problem is, none of that is true. But dealerships change car salesmen like normal people change their underwear, so he probably won't even work here by the time you burn out a $4,000 transmission and get stuck with the bill.

    And attempting warranty fraud may be tempting, but in reality, it is a really bad idea. You may put one over on the dealership, but you're screwing everyone else that buys a car, because the manufacturer is still going to turn a profit- they'll just jack up the price of the cars and pass on the expense of your theft to every other consumer. Your thieving would be just like smashing out the windows of everyone else's cars and stealing their stereos. And when the fraud is discovered, the dealership will lose important privileges that could have helped honest customers, and things will be put into place that make simple warranty repairs more of a pain to obtain, because they're going to be more careful next time.
    Last edited by RIS; 02-24-2010 at 06:26 PM.

  2. #2
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    As you can see, the concept of paying extra for an "extended warranty" would not be consistent with the reality of what a warranty actually is. Why would someone charge you extra to give you more time to find defects in their product? It makes no sense.

    What most people are actually referring to when the words "extended warranty" come up, is an MBI (Mechanical Breakdown Insurance) policy. You're buying insurance. And like any insurance, when the insurance company sells it to you, they are doing so in the hopes that they will be able to charge you more for it than they are going to have to pay out in claims, and in buying it, you are hoping that they will have to pay out more in claims than they charged you for it. In reality, it is one of the most profitable things that a dealership can cram up your behind. I mean, think about it- you're buying a piece of paper for $1,500. They often go to great lengths to make you think that it's a warranty- tricky stuff like naming the company "National Federal Extended Warranty Corporation" or something like that. It's not a warranty, they just use the word "warranty" in the name of their company. And they often license the brand of car, to make it look like you're actually buying it from the manufacturer (because it says "Chevrolet" or "Ford" on the policy, but in reality, you're buying it from some guy named "Guido" in New Jersey). The fact that you're purchasing it at the dealership makes the last part easier to put past you.

    MBI policies vary in their usefullness. Some are virtually worthless, and some will do something for you. In all cases, they will only pay for what they say they will pay for, so don't believe all the BS that the F&I guy tells you in that littlle booth. Floating words out in space is not the same thing as ink on paper, and he's probably not going to be working here when you have your first problem either.

    Remember to subtract the vehicle's original warranty coverage when figuring out exactly what you're being asked to pay for. If a particular vehicle has a 5 year / 50,000 mile warranty, and you're looking at purchasing a 6 year / 60,000 mile MBI policy, you're only really buying a year or 10,000 miles of coverage.

    The usefullness of an MBI policy also has a lot to do with the skill and personal integrity of the Service Consultant administering the policy. Everybody thinks that they can be a Service Consultant, but many are hacks, and they can botch your whole claim by using the wrong words, or worse, by lying to the insurance company. If they get caught lying, the insurance company will send out an inspector on every single claim that they do from then on, and they will be checking over your oil change receipts and putting your car under a microscope.

    You should expect to have to authorize diagnostic time up front- the insurance company will have no interest in paying a dealership to go on an exploratory search for things to charge the insurance company for. If a claim is approved, reasonable amounts of diagnostic time are usually covered. YOU will need to authorize repairs on YOUR vehicle, even after a claim is authorized. Don't be surprised if the dealership requires you to pay for the repairs in full before releasing the vehicle to you. It's better than it used to be, but many MBI companies are extremely slow to pay, or even fold up their tents and vanish after selling a bunch of policies- the dealership isn't going to risk getting stuck holding the bag on your car repairs.
    Last edited by RIS; 02-24-2010 at 11:36 PM.

  3. #3
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    Here is how goodwill privileges work:

    Goodwill privileges are discretionary repair privileges that the manufacturer awards to individual dealerships, to be used for things that fall outside of the warranty. Kind of like a "favor bank".

    The manufacturer sends out customer satisfaction surveys directly to the customers. The dealership's individual scores determine how much the manufacturer is willing to trust the individual dealership with goodwill privileges. Good scores mean a good amount of privileges, bad scores may mean no goodwill. So when you are looking for goodwill, it's important (before you waste a bunch of time) to straight up ask if your particular dealership is even capable of authorizing what you're asking them for. No sense in asking for something that they're not capable of even delivering. Also something to consider when venting your frustrations in the survey- you could really shoot yourself in the foot with that one, by preventing the dealership from having the privileges that you need for them to have to be able to help you.

    Just like warranty, goodwill is there to serve THEIR interests, not yours. So keep that in mind when chosing your words. Imagine if you had two customer that wanted goodwill:

    1) The first customer lives two blocks away from your dealership, but buys his cars over the internet from Costco, and drives 200 miles to pick them up. Then he shows up in your service drive without an appointment, demanding a loaner car and whining about every little warranty blemish. He takes his car to the local Strip-your-drain-plug-in-a-minute place for his oil changes. He only comes to your service department when you offer free tire rotation coupons, and even then, he declines all of his other past-due maintenance, sucks up all of your free coffee and donuts in the waiting room, and sits in there telling all the other customers how much cheaper they could have gotten it elsewhere. He slaughters you on the customer satisfaction surveys. Then his transmission fails, 5 miles out of warranty. He shows up and throws a screaming temper tantrum, stomping around the dealership, ranting at the top of his lungs about how this was the biggest piece of crap that he ever bought, and he'll never buy one again. He eventually makes his way back to your office, and demands that you fix his car at no charge, because it's "not his fault".

    2) The second customer has been buying cars at your dealership for years. He makes appointments. He shows up on time. He graciously accepts a shuttle ride to work instead of demanding a loaner car. He brings it to you for all of his scheduled maintenance. He's fair towards you on his surveys. His transmission fails 30,000 miles out of warranty. He approaches you in all humility, and tells you that he realizes that he's way out of warranty, and asks respectfully if there is anything that you can do to help. He further explains that he is due for another car, and he'd feel a lot more comfortable about it if this experience left him the ability to go tell all of his friends about how thankful he was that this particular dealership helped him out when he didn't deserve anything.

    I think it's pretty apparent that no matter what you do for the first guy, he's going to continue to be just as much of a jerk, whether you help him or not. There's no ROI (Return On Investment) with him.

    With the second guy, if you help him out, the dealership will most likely continue to make money off of him for many years to come.

    So which one would you choose to help?

    I'll give you a hint. They're both real customers. With the first one, I called the local Police and had him removed from the premises after issuing him a trespass warning (telling him if he ever stepped foot onto the property again, he'd be arrested on sight). I also refused to work on his car, and told him that I was charging him for storage until he called (not using my phone) a tow truck to get it off my lot. The second guy got a free transmission.
    Last edited by RIS; 02-24-2010 at 11:43 AM.

  4. #4
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    Well the only car ive ever bought was a 6 year old chevy blazer with no warranty at all. I got it checked out my known and trusted mechanic, he gave the A-OK, I paid the folks for their truck. And i keep (or try to keep) 2k in the savings for some unforeseen problems, none yet and im keeping my fingers crossed.

  5. #5
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    good post RIS some of it a little close to home for me and I know exactly where you are coming from. We like the people that buy out of state or area and treat you like a low life when you can't drop everything when they have a problem. makes it hard to keep a smile on some days but it is all good when you get the greatfull and fun to service people.

  6. #6
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    Yep, hit close to home here as well. I really like the BMI piece, those insurance policies are a waste of money for consumers.

    We recently purchased a new car. My wife took it in today for the first oil change. The salesman promised a free loaner car when we had any service done, come to find out that oil changes are not included in this policy. Hmm...point #3 to a T.

    Actually, when we went to pick the car up, we were in a huge hurry as my wife had to get back to work. Everyone at the dealer knew this and we were the only people buying a car that day (around Christmas time). The fact that we were in a hurry didn't stop the finance guy from explaining the BMI to us for almost an hour. When somebody tries that hard to sell you something, it is ALWAYS a waste of money and they know it.
    CyclingCentralVa.org

  7. #7
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    I forgot to say in my first post that the info above is good. And sometimes in life its not who you are but how you carry yourself in various situations that defines your true personality

  8. #8
    RIS
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    Recalls:

    If you take your vehicle to the dealership, you should be able to count on your Service Consultant to check your vehicle for any APPLICABLE campaigns.

    Keep in mind that just because a manufacturer has a recall, it may not apply to your vehicle, even if you're having a problem that sounds like the recall.

    For example, let's say that you own a bright red Trabant 4-door Sedan, and it constantly pulls hard to the left, regardless of input, causing a danger of totalling the vehicle and killing you. Then you see in the newspaper, that Trabant is recalling three million Trabants, for a steering concern. You read further, you see that the recalled vehicles all pull hard in the direction of Komrade Obama, regardless of input, causing a danger of totalling the vehicle and killing it's occupants. Your neighbor also owns a bright red 4-door Trabant. Your neighbor tells you that he took his Trabant to the dealership, they did the recall, and now his doesn't pull to the left anymore. So your panties bunch, your palms sweat, and with much hand-wringing and histrionics, you show up in your Trabant dealer's service drive. The consultant runs your VIN, and tells you that your vehicle is not affected by the campaign.

    This does NOT mean that the dealership is trying to deprive you of anything. It just means that your vehicle is not involved in the campaign.

    So, with your hands dried, your panties un-bunched, and a fresh load of SSRI medications, you ask why your car pulls to the left. The Service Consultant walks out into the service drive, and notices that your left front tire is flat. Out of professional courtesy, he turns away so that you won't see him rolling his eyes and smacking his forehead with his palm. He then grabs the lube flunky, has him install your spare tire as a courtesy, powders your little behind, and points you in the direction of a tire store so you can go buy a new tire.

    Fairly true story.
    Last edited by RIS; 02-24-2010 at 07:15 PM.

  9. #9
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    Or you do an internet search and find that car smearch show a TSB for the rear hub bearing and even though you are not having any problem it really need to be replaced this afternoon cause we planned to leave for our family trip thet was planned 8 months ago and will be ruined if it is not done by 3:27 pm so the wife can get the kids to soccer/piano/knife sharpening lessons

  10. #10
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    ... guys... as a technician here... it really kills our day and our hours if you ask for 3 pages of warranty work in one shot.

    and certain cars make certain noises, squeeks, and rattles... it's normal, esp in NY. get over it.

  11. #11
    RIS
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    Quote Originally Posted by dadat40
    Or you do an internet search and find that car smearch show a TSB for the rear hub bearing and even though you are not having any problem it really need to be replaced this afternoon cause we planned to leave for our family trip thet was planned 8 months ago and will be ruined if it is not done by 3:27 pm so the wife can get the kids to soccer/piano/knife sharpening lessons
    Apparently you've played this game before.

    Extra points for the "customer" that brings a print-out of the TSB from his home computer, demanding a 4WD transfer case update for his 2WD vehicle.
    Last edited by RIS; 02-25-2010 at 11:37 AM.

  12. #12
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    Quote Originally Posted by qqfob
    ... guys... as a technician here... it really kills our day and our hours if you ask for 3 pages of warranty work in one shot.

    and certain cars make certain noises, squeeks, and rattles... it's normal, esp in NY. get over it.
    "But the salesman promised..."

    In all seriousness, your issue is not with the Service Consultant. He's responding to the customer. And your problem is not even with the customer. His expectation came from somewhere. The question that you should be asking is where did that expectation come from? Like the guy that bought a 3/4 ton diesel pickup and is upset about the fuel mileage. Why should he be upset about anything? The manufacturer makes no quantifiable fuel mileage claims in any of their sales literature, nor are there any quantifiable fuel mileage claims on the Monroney sticker. I'm guessing it was the salesman who told him that his 3/4 ton 4x4 crew-cab pickup with leather, power everything and A/C, would get 25 mpg while towing the Queen Mary uphill at 80 mph.

    Knocking the salesman's teeth out is one option, but unless you have a couple hundred dollars to bail yourself out, it can be a hassle. I have worked with people who found graphite-impregnated bearing grease under the door handles and wiper blades of the salesman's personal vehicle to be helpful, as can a few 6-ounce wheel weights randomly tapped onto the inside flange of his front wheels. If that doesn't work, try using the leverage afforded by a 10" pair of Vice-Grips, to pull his valve stems out through the face of the wheel (he'll have to dismount to install new ones). They usually get the hint after a while.
    Last edited by RIS; 02-25-2010 at 11:58 AM.

  13. #13
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    tip the tech, not the adviser!

  14. #14
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    Quote Originally Posted by qqfob
    tip the tech, not the adviser!
    The Service Consultant is the one that keeps the techs fed. There is nothing wrong with tipping a Technician, but to recommend not tipping the Service Consultant is like biting the hand that feeds you. Ever wonder why some techs only get water leaks and NVH concerns, and others are constantly riding the 60K full meal deal gravy train? It only makes sense to reward good behavior.

  15. #15
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    I only said that because in my case, my advisers are know to pocketing "our" tips.

    So make sure you attach the customer filled NVH forms, so my straight time actually gets paid for. And pay me for those tire lights too, as well as the fuel lid evap leak... And 27point checks does not mean "free diag". Oh, yeah, don't forget aftermarket alarms are considered "aftermarket" and technically I don't have to work on it or anything it connects to.

  16. #16
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    Your tool box has wheels, doesn't it?

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