Warranty shock for 1m
August 31st, 2010 by Richard Aucock
CAR owners face a £300 million hit in car repair costs as 1 million motors come out of their warranty period.
A 2007 boom in new car sales – 2.4 million new cars were sold – means the 3 year warranty period will be ending for many.
Warranty provider Warrantywise estimates these owners risk a spike in repair bills based on estimates from their claim records.
For each of those 1 million owners, this is a potential hit of more than £700 – with suspension, steering, alternators and sensors topping the list of most-failed components.
This could present dealers with an opportunity to encourage owners into new motors, to realise the benefit of a new car warranty again.
Alternatively, it’s an opportunity to upsell an aftermarket warranty extension, with Warrantywise boasting plenty of packages for car owners.
Lawrence Whittaker, MD of Warrantywise, said: ‘The common arguments for not getting a warranty often start with the notion that particular car marques are ‘reliable’.
‘However, a car is a mechanical object and as with all mechanical objects, the chances of a part failing are extremely high.
‘Over 59 percent of our customers make a claim on their warranty in the first 12 months according to our figures.’
Indeed, Whittaker went further: ‘By getting a warranty, you can effectively be ‘in profit’ if you compare the costs of a warranty to the likelihood of major failure.’
The perfect fact to help you mine your DMS system for 3 year old car owners and upsell a used car warranty!
Tags: aftersales, new car sales, SMMT, warranty, warrantywise