Car warranties can provide peace of mind
As automobiles have continued to improve in styling, safety and performance, so too have automobile warranties improved.
A standard new car warranty on passenger vehicles and light trucks is three years or 60,000 kms, whichever comes first. In recent years, some automakers have introduced enhanced basic warranty coverage of four and five years, and powertrain coverage of four to 10 years.
Auto-warranty coverage has become a highly competitive selling feature among brands, and automakers aren’t shy about highlighting the superiority of their respective coverage in their marketing.
Basic new car warranties cover mechanical malfunctions that happen during normal use of the vehicle. They do not include wear and tear items, such as air filters, brake pads, wiper blades and tires.
There are instances where a dealership or manufacturer could deny a customer’s coverage within the warranty period. A warranty could be voided if it can be proved that an owner neglected a serious mechanical issue or regular maintenance, or if Original Equipment Manufacturer parts were replaced with aftermarket and/or performance parts.
Car shoppers should study the basic warranties on any new vehicle they’re interested in buying. That would include what components are covered and what, if any, deductibles are required, as well as knowing their anticipated driving habits and how many kilometres they plan on driving while they own the vehicle.
In some cases, an extended warranty or service contract makes good financial sense. This optional coverage is considered an add-on purchase item. The cost of an extended warranty is approximately $1,000 to $2,500, which can be blended into the financing cost and monthly payment.
If you are considering an extended service contract, research the reliability of your model of vehicle and pay attention to the details of the contract. Some contracts require per visit deductibles while others require per repair deductibles, meaning owners must pay a specified amount for each repair item.
Extended auto warranties can be purchased when you buy the car, or any time after you take delivery (while the car is still under basic warranty). But the more kilometres a car has on it, the more an extended warranty will cost.
Extended warranty protection is also available on pre-owned vehicles sold at registered car dealerships. Just as new vehicle warranties vary in cost and coverage, so do Certified Pre-Owned warranties differ. Most automakers offer Certified PreOwned programs, consisting mostly of trade-ins and lease returns, which are inspected and come with warranties and manufacturer financing.
At our Ford dealership in Huntsville, we sell only Certified PreOwned warranties provided by Ford, which include a complete vehicle inspection, broad warranty coverage, a vehicle history report, roadside assistance, and more.
If you plan on selling a pre-owned vehicle that has Certified PreOwned coverage on it, in most cases the warranty is transferable, although a few automakers require a fee to facilitate that transaction.
My suggestion would be for car shoppers to do their homework before buying a Certified PreOwned vehicle. If there is ample time or distance left on the warranty of the vehicle you want to buy, the warranty can be transferred to your name for a modest administration fee. A great place to find your next car is at carsandjobs.com, a website that also has over 600 job postings.
The bottom line on auto warranties is that they have come a long way in terms of coverage and can provide substantial peace of mind. This column represents the views of TADA. Email president@tada.ca or visit tada.ca. Doug Sullivan, president of the Trillium Automobile Dealers Association of Ontario, is a new car dealer in Huntsville, Ont.