Better Mercedes Warranties?

[hawk20]

Better Mercedes Warranties?

How long will it be before Mercedes respond to the growing number of car-makers who are offering longer guarantees?

Kia offered the 7 year warranty to set the cat amongst the pigeons. And it is transferable on sale of the car.

Toyota followed recently with a 5 year transferable guarantee on their cars (partly, no doubt, in response to all the bad publicity about recalls etc)

Now on new car sales from August 1st Vauxhall is offering a “LifetimeGuarantee”. That is defined as the lifetime of the vehicle up to 100,000 miles. But –and it is quite a big but- the guarantee only applies to the first owner and is therefore not transferable.

Still, the pressure is clearly mounting. Perhaps some day soon MB and BMW will feel they have to respond?
http://www.vauxhall.co.uk/owners_services/warranty_assistance/vauxhall_lifetime_warranty.html

 

[st13phil]

Actually, I'm not sure that they will.

In the "mass market", most people have little interest in cars per se and are buying something akin to a domestic appliance, something that gets them from A to B and doesn't break down in the process. For those consumers the length of warranty is a significant factor in their buying decision as they don't actually care much whether they buy a Kia, Toyota, or whatever. Fleets don't generally give a monkey's about the length of warranty as they won't be running the vehicle after 3 years anyway.

For brands like BMW, Mercedes, Jaguar, etc., in general people are buying a car that they enjoy driving and many buy the brand as much as the product. In this market, would a 5-year warranty on a Mercedes persuade someone who was minded to buy a BMW to buy the MB instead if the BMW only had a 3-year warranty? Probably not.

 

[davidjpowell]

I can remember when the 3 year warranty came in, and the premium manufacturers resisted for a while. Eventually they had to join the party.

 

[crockers]

I think the Vauxhall Warranty is a fantastic piece of marketing....all show with little substance.

Most are fleet / Company cars - Co cars get changed around 3 year 70,000, hire cars around 1 year - so no lifetime warranty there.

The private buyer will keep their car roughly around 5 years - 50,000 miles.

So the number who keep them up to 100,000 miles is pretty small - but what great PR..

 

[hawk20]

For brands like BMW, Mercedes, Jaguar, etc., in general people are buying a car that they enjoy driving and many buy the brand as much as the product. In this market, would a 5-year warranty on a Mercedes persuade someone who was minded to buy a BMW to buy the MB instead if the BMW only had a 3-year warranty? Probably not.

Firstly, I know plenty of people who own mass-market brands and love them as much as I love my Mercedes (well nearly!).

Secondly I think that while new buyers may not care too much about warranties after 3 years (as they are mainly company car buyers in some form or other), what they will care about is the higher three-year residual which should happen if there are longer transferable warranties.

 

[st13phil]

Firstly, I know plenty of people who own mass-market brands and love them as much as I love my Mercedes (well nearly!).

So do I - apologies, that's the problem with generalisations My point was that the ratio of private purchasers who think of a car as akin to a domestic appliance is higher for mass-market products than it is for the premium brands.

I'm not sure that there would be much of an effect on residuals, either. Dealer prices set the benchmark for residuals and reputable dealers already offer a warranty on a used car - which the dealer funds. The presence of a manufacturer's warranty notionally removes the cost of warranty provision from the dealer, but they would still have to bear the cost of any rectification work needed prior to sale so my guess is that the net effect on residuals (outside of private transactions) will be close to zero.

It's also worth commenting that the premium brands only moved to 2 year warranties when compelled to by the EU, whereas other mass-market brands were already offering 2- and even 3-year warranties. If the premium manufacturers thought there was competitive advantage in offering longer warranties then they would do so of their own volition, which they conspicuously haven't. They may, however, be "shamed" into offering longer warranties, but I doubt they'll be in a rush to do so.

 

[davidjpowell]

So do I - apologies, that's the problem with generalisations My point was that the ratio of private purchasers who think of a car as akin to a domestic appliance is higher for mass-market products than it is for the premium brands.

I'm not sure that there would be much of an effect on residuals, either. Dealer prices set the benchmark for residuals and reputable dealers already offer a warranty on a used car - which the dealer funds. The presence of a manufacturer's warranty notionally removes the cost of warranty provision from the dealer, but they would still have to bear the cost of any rectification work needed prior to sale so my guess is that the net effect on residuals (outside of private transactions) will be close to zero.

It's also worth commenting that the premium brands only moved to 2 year warranties when compelled to by the EU, whereas other mass-market brands were already offering 2- and even 3-year warranties. If the premium manufacturers thought there was competitive advantage in offering longer warranties then they would do so of their own volition, which they conspicuously haven't. They may, however, be "shamed" into offering longer warranties, but I doubt they'll be in a rush to do so.

I thought that Premium manufacturers in the UK were now at 3 years, albeit the last year is often added by the UK distributor rather than the actual manufacturer. Some I think still cap the mileage at 60k, but I note that Mercedes do not. I think BMW used to, but that has changed, perhaps in reaction to MB.

 

[Rory]

I think the Vauxhall Warranty is a fantastic piece of marketing....all show with little substance.

Most are fleet / Company cars - Co cars get changed around 3 year 70,000, hire cars around 1 year - so no lifetime warranty there.

The private buyer will keep their car roughly around 5 years - 50,000 miles.

So the number who keep them up to 100,000 miles is pretty small - but what great PR..

In the case of the 5yr/50K private buyer, which would be me with wifey's car, I think it's a very useful and valuable benefit.

In fact I recently paid around £1000 for a 5 year servicing / 5 year warranty deal on her new Honda Jazz - an included 5yr warranty would have saved many hundreds of pounds.

 

[hawk20]

In the case of the 5yr/50K private buyer, which would be me with wifey's car, I think it's a very useful and valuable benefit.

In fact I recently paid around £1000 for a 5 year servicing / 5 year warranty deal on her new Honda Jazz - an included 5yr warranty would have saved many hundreds of pounds.

I agree. And if cars had 5 or 7 year warranties many might be tempted to 'risk' owning a premium brand who are currently put off by the possibility of a giant repair. Put my name down for a 3 year old S class please.

 

[grober]

Question:- Would the possibility of a claim for a failed component under an extended warranty lead to cars being built with components designed to last for that extended length of time? Some cynics would say that cars are built to last only as long as their warranty. If that's to be believed then would the extension of the warranty period force the adoption of a longer component design life. If that was the case then subsequent owners [altho not covered by warranty] might benefit from improved component longevity indirectly?

 

[hawk20]

Think how nice it would be with a long warranty when the mechanic says: "It could be this; it could be that; it could be something else." And then proceeds to keep changing parts until the problem is fixed. And you're not paying. Luvverly!

 

[whitenemesis]

I agree. And if cars had 5 or 7 year warranties many might be tempted to 'risk' owning a premium brand who are currently put off by the possibility of a giant repair. Put my name down for a 3 year old S class please.

The VX 'Lifetime' warranty is for the 1st owner only? I expect MB would follow if at all

 

[whitenemesis]

Think how nice it would be with a long warranty when the mechanic says: "It could be this; it could be that; it could be something else." And then proceeds to keep changing parts until the problem is fixed. And you're not paying. Luvverly!

I had something similar with the Service-Plus on my creaking suspension/chassis but be certain MB wont go down that road again!!

 

[Rory]

I agree. And if cars had 5 or 7 year warranties many might be tempted to 'risk' owning a premium brand who are currently put off by the possibility of a giant repair. Put my name down for a 3 year old S class please.

The dilema for Mercedes etc is, would it mean people who bought new cars and changed them at 3 years would switch to 5 year change cycles? Imagine what that would do to new car sales figures, and MB UK are suffering as it is.

As far as I can tell, this business of changing cars frequently is very much a UK thing - in other countries people already hang on to cars for years and used cars have much higher value than they do here.

Think how nice it would be with a long warranty when the mechanic says: "It could be this; it could be that; it could be something else." And then proceeds to keep changing parts until the problem is fixed. And you're not paying. Luvverly!

There have been increasing reports from various marques that dealers won't do that anymore, even under the 0-3yr warranty. They can't claim for work unless they find something wrong, so unless the computer shows a fault, or there's something clearly wrong, they won't spend time on diagnosis unless you agree to pay. Dealers are businesses - someone has to pick up the tab.

 

[st13phil]

I thought that Premium manufacturers in the UK were now at 3 years, albeit the last year is often added by the UK distributor rather than the actual manufacturer.

Yes, they are 3-year warranties on MB / BMW etc in the UK now, but my point was that they stuck fast to the 1-year warranty until the EU mandated that they had to give a minimum of 2 years. Had they thought it would have improved their business they wouldn't have waited for it to become a legal requirement and would have done so earlier.

 

[blondebier]

I think MB et al will be forced to extend their warranties... I can't see people being content with a 3 year warranty any more.

If the "cheaper" (I'm not implying inferior) brands can offer 5, 7, X year warranties then they will be forced to catch up at some point.

I would think that a fair few of MB sales are fleet/company sales and in the current economic climate a warranty is probably a fairly big consideration for the bean counters.

 

[blondebier]

I've just done a little googling and Audi's warranty is quite interesting :

All new Audi models now come with a choice of a three, four or five year warranty*. What’s more, if you decide to sell your Audi before the warranty expires, it will be fully transferred to the new owner. So, whichever length of warranty you choose, you can forget about unexpected repair bills and enjoy several years of carefree driving.

*Three year warranty consists of a two-year unlimited mileage warranty and a third year warranty with a 60,000 mile limitation. Four year warranty consists of two-year unlimited mileage coverage, and two further year’s coverage with a 75,000 mile limitation. Five year warranty consists of two-year unlimited mileage coverage, and three further year’s coverage with a 90,000 mile limitation. Only available at point of new car order. Fully transferable to subsequent owners.

The 5 Year - 90,000 mile warranty isn't half bad...

 

[Aletank]

I've just done a little googling and Audi's warranty is quite interesting :

All new Audi models now come with a choice of a three, four or five year warranty*. What’s more, if you decide to sell your Audi before the warranty expires, it will be fully transferred to the new owner. So, whichever length of warranty you choose, you can forget about unexpected repair bills and enjoy several years of carefree driving.

*Three year warranty consists of a two-year unlimited mileage warranty and a third year warranty with a 60,000 mile limitation. Four year warranty consists of two-year unlimited mileage coverage, and two further year’s coverage with a 75,000 mile limitation. Five year warranty consists of two-year unlimited mileage coverage, and three further year’s coverage with a 90,000 mile limitation. Only available at point of new car order. Fully transferable to subsequent owners.

The 5 Year - 90,000 mile warranty isn't half bad...

Is the 3 Year Warranty Standard
and the 5 Year Warranty a extra that you pay for ?

 

[blondebier]

Is the 3 Year Warranty Standard
and the 5 Year Warranty a extra that you pay for ?

I'm not sure...

Here's the link :

Audi warranty < Supporting products < Owners area < Audi UK

 

[Aletank]

I'm not sure...

Here's the link :

Audi warranty < Supporting products < Owners area < Audi UK

Oh they charge