7:47 am, October 20, 2008
BUYERS are opting for higher levels of warranty cover on used cars, according to evidence from RAC Warranty.
This is again driven by the credit crunch; motorists are looking to protect themselves from unexpected bills.
Over the past few months, sales of ‘Gold’ and ‘Platinum’ packages have gone up, in relation to the less comprehensive ‘Silver’ deal.
‘Silver’ is usually given free by FSA dealers; customers have to pay for the more inclusive packages. And are increasingly willing to do so.
Ian Simpson, sales and marketing director, said: ‘In an economic slowdown, used car customers are willing to pay more upfront in order to minimise the chances of having to face an unexpected repair bill in a few months.
‘This underlines that what customers desire at the moment, more than anything, are predictable costs. They are still willing to spend more money, such as an upgrading their warranty, if they believe that it represents value.’
This is great news for you – a rare stream of increased revenue for you to tap into. And complements findings Car Dealer has already reported on.
As Simpson added, ‘this increased demand for more comprehensive warranty cover represents… a genuine revenue opportunity for dealers, during a period when overall margins are tightening.
“We are encouraging salespeople to spend time explaining to their customers exactly what each level of warranty cover provides, so that they can make an informed decision. It is a subject that many customers are genuinely interested in at the moment.’
