There are many important aspects that can add or detract from the value of a new car purchase. Besides the actual selling price of the vehicle, other aspects like fuel mileage, safety, maintenance costs, residual value and reliability can have a tremendous impact on a vehicle’s value.
Since some repairs can run thousands of dollars, another important factor often over looked by consumers is the type of factory warranties offered on a new vehicle. Just like some of the value considerations listed above, new car warranties should be an important factor when comparing value. This article looks at the different aspects of new vehicle warranties to help the consumer make an informed purchasing decision.
Bumper-to-Bumper New Vehicle Warranty
Often referred to as the “bumper-to-bumper warranty” the basic warranty that comes with a new car purchase generally does not cover every component on the vehicle. Maintenance items for example may not be covered. Wear items like brakes and tires may also be excluded or have coverage that’s prorated, where the owners pays a portion of the replacement cost.
Other items may also be excluded from the basic new vehicle warranty. That’s why it’s important to read the find print on the policy statement to discover the exclusions. When shopping for new vehicles, compare the different warranty exclusions. Remember, not all new vehicle warranties are created equal.
Powertrain and Major Component Coverage
Some new vehicles may have a powertrain or major component coverage. These added value warranties are usually for an extended period of time above and beyond the basic warranty coverage. Powertrain generally includes
- engine
- transmission
- driveshaft
- axles
Major component coverage will generally include powertrain components plus other major components like electrical, heating, air conditioning or emission related parts. These types of coverage’s can vary widely from one vehicle model and/or manufacturer to another. Just like basic warranty coverage, not all powertrain or major component policies are created equal.
Time and Mileage on a New Car Warranty
Besides comparing actual component coverage between various models, it’s equally important to compare the policy time and mileage limits. There are some exceptions but generally each type of warranty has a set time and mileage limit.
If a policy states that the new vehicle is covered for 3 years or 100,000 miles, it generally means which ever comes first. The time limit usually begins at the actual purchase date. The mileage limit is generally the actual odometer reading. As an example using the time and mileage limit of 3 years or 100,000 miles, if the car has a concern and needs repair and it’s been 2 years since the purchase date yet the odometer reads 105,000 miles, the vehicle is out of warranty by mileage.
There may also be other coverage’s that come with a new vehicle purchase. Some manufacturers offer free maintenance. Others may offer an extended emissions or safety component coverage. Some manufacturers offer roadside assistance or rental car coverage.
The important thing to remember is that warranty coverage between car manufacturers can vary widely. Ask the new car dealership for a warranty policy statement. When comparing vehicles for a new car purchase, look at the warranty policies for actual component coverage as well as time and mileage limits.
James Clausen - Clausen received a Bachelors Degree in Business Administration in Automotive Management and Marketing at Northwood University, graduating ...
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