One of the blessings of a new car is a warranty. If something goes kerplunk in the night, at least you won’t have to pay to fix it. As your car gets older you won’t have the assurance of a warranty. However, follow the maintenance advice in the preceding section and you'll keep repair costs - even on an old car - to a minimum. Preventive maintenance will prevent costly breakdowns.
Manufacturer Warranties
Every automaker offers a warranty on its new vehicles. So what then is the important difference between automakers’ basic warranties? Time. For decades, the traditional warranty was 12 months or 12,000 miles, whichever came first. Today, that warranty has gone the way of 8-track stereos and carburetors.
Among the major automakers from Europe, Japan, Korea and the U.S., basic bumper-to-bumper warranties now range from three years and 36,000 miles to as long as five years and 60,000 miles. Kia and Hyundai each offer a 5-year/60,000-mile bumper-to-bumper warranty and a 10-year/100,000-mile powertrain warranty, though the latter is not transferable to a subsequent owner. Chrysler offers a 3-year/36,000-mile bumper-to-bumper warranty and 5-year/100,000-mile powertrain warranty. Suzuki has a 3-year/36,000-mile bumper-to-bumper warranty and a 7-year/100,000-mile powertrain warranty with no deductible - and it's fully transferable to future owners. But the longest warranties are usually from luxury marques.
Given the high cost of repairs on modern, electronically complex vehicles, and given the fact that more things are likely to go wrong the older a vehicle becomes (often beginning in year three), the extra miles and years of coverage can be a true money saver. If you plan to keep your vehicle longer than three years or 36,000 miles - and the vast majority of buyers do - compare warranties as you shop.
It’s just as important to consider the basic warranty if you lease your new vehicle. If the term of your lease is longer than the vehicle’s basic warranty, you may wind up with out-of-pocket expenses for say, a new transmission, in what is essentially a rental vehicle. The basic bumper-to-bumper warranty is nearly always transferable to a subsequent owner. So if you want to sell your vehicle after four years and 48,000 miles and there’s still a year and 12,000 miles left on the basic warranty, this will be a positive resale feature.
Roadside Help Automakers and dealers alike have recognized the importance of customer service in the long-term success of their products. Many now offer roadside assistance programs with their new cars, usually at no extra charge. Virtually every automaker offers free towing service in the event of a breakdown while the car is still covered by the bumper-to-bumper warranty. And though some offer little more than free towing, others are more comprehensive. Mercedes-Benz will pay for flat-tire repair, lockout service and minor repairs no matter how old the car may be or how many miles are on the clock.
Service Contracts (aka Extended Warranty or Mechanical Breakdown Insurance)
As a new-car buyer you’ll be confronted with the option to purchase yet another warranty of sorts - an extended service contract. Typically, the dealer will offer the contract to you at the time you buy the car. There's no doubt about it: extended service contracts are big business. Nearly half of all new-car buyers purchase these contracts.
The typical extended service contract backed by an automaker can have a markup of 100% by the automaker to the dealer, plus a 200% to 300% markup by the dealer to the car buyer. Extended service contracts can be a rip-off - or they can be a prudent form of budget control by eliminating unexpected repair bills.
Whether one is right for you depends upon a) how many miles a year you drive your car, b) how long you plan to keep your car, and c) the length of the new-car basic warranty. If for example, you buy a new car with a 3-year/36,000-mile basic warranty and you plan to keep it for five or six years and drive it 90,000 or 100,000 miles, then an extended service contract may be right for you. But if you plan to keep the car for four years and 48,000 miles, you may be better off to self-insure. Put the money that you would otherwise pay for the contract in the bank; it’s there if you need it for a repair during your last year of ownership, and if you don’t, the money is still yours when you trade in the car.
There’s a less-well-known alternative to dealer-marketed extended service contracts called “mechanical breakdown insurance” or MBI. This insurance is underwritten by insurance companies and is available only through licensed insurance agents. Unlike extended service contracts, MBI policies typically must be approved by a state’s department of insurance. MBI policies are often comprehensive in their coverage. Prices are comparable to or even less than dealer-offered service contracts. Their prices however, are not negotiable. The policies are sold through insurance agencies. Many credit unions have licensed insurance agents on their staffs who can sell MBI policies.
If an extended service contract seems right for you, follow these guidelines when you purchase one.
Consider the source. Not all extended service contracts are backed by the automaker. Dealers may offer contracts backed by independent companies, often at a lower price. But automakers are less likely to disappear.
Consider what’s covered. Some contracts may only cover the powertrain - the engine, transmission and differential - but in modern cars these items are much less likely to fail than all the electronic components and amenities that now come standard. Virtually no contract will cover normal “wear” items like brake pads. Expect there to be some sort of deductible for each repair as well.
Consider who’s to perform the repairs. A contract offered by a dealer will probably require the repairs to be made at that dealership. A contract backed by an automaker will usually allow you take the car to any of its authorized dealers.
Consider how the bill is to be paid. Some contracts require you to pay the bill; you'll be reimbursed later. Others provide for direct payment to the repair shop, which is preferable.
Consider the price. Extended service contracts, like most everything else in buying a new car, are negotiable. There’s usually plenty of room to bargain. Try offering half the price quoted by the dealer.
Repair Advice
For many car owners, a visit to a repair shop is accompanied by all the joy and excitement of heading for the dentist’s chair. There are ways to make the visit less painful, however. If your car is under warranty, you’re pretty much married to an authorized dealer for repairs. But if you receive lousy service from the dealer who sold you your car, there’s no reason why you can’t high-tail it across town to another authorized dealer for service. All dealers must honor a manufacturer’s warranty whether or not they originally sold the car.
Once your car is out of warranty you have a couple of other choices. You can take your car to an independent mechanic or to a specialist who works on only specific components: radiators, brakes, mufflers and so on. Independent mechanics and specialists will often charge less than a dealer. But make sure they have a working knowledge of your kind of car, can obtain the correct parts, and have the diagnostic equipment necessary to repair complex electronic gadgets found in so many cars today.
How do you find a competent, trustworthy mechanic? There’s a certain amount of trial and error involved, but recommendations from friends or owners of cars like yours are usually your best bet. In addition, mechanics usually know the scoop on other mechanics in town. If you buy a Chevy and know a good Toyota mechanic, ask him or her to recommend someone who works on Chevys.
Whether you take your car to a dealer, independent mechanic or specialist, be polite. It’s a great American pastime to bad-mouth auto mechanics - and unfortunately, some deserve it. But in the long run, a car is only as good as the mechanic who takes care of it.
Here are some pointers to help the two of you have a long and happy relationship:
A good mechanic may have grease on his overalls, but don’t treat him as if he’s not intelligent. You can’t be a dummy and properly repair complex, modern cars.
Follow a trusted mechanic’s repair recommendations. A good mechanic will spot potential problems before they occur.
Look for ASE (Automotive Service Excellence) certification. ASE-certified mechanics have passed rigorous industry tests and continually update their technical know-how.
If you’re not sure whether to trust a mechanic, ask to watch while he works on your car. If that’s not possible, you should at least expect him to explain the problem in simple language and to show you the defective part while it’s still on the car. If he’s a good mechanic, he’ll appreciate your interest.
It’s proper business practice for you to receive a written estimate before any work is performed. In some states it’s the law. Additionally, if you authorize a repair and the mechanic later finds more work is necessary, he should get your permission to raise the estimate before he does the work.
If you don’t trust the mechanic and the quote seems too high, be sure you understand what’s involved with the repair. Then, before you agree to the repair, telephone one or two other mechanics for quotes so you can compare.
When talking to your mechanic be as specific as possible. “There’s a high-pitched squeal that seems to come from the right rear wheel between 50 and 60 mph,” is a lot more helpful than “The wheel makes funny noises.”
If you’re unhappy about work you paid for, contact your state’s bureau of automotive repair. As a last resort, small claims courts are generally sympathetic to car owners who can present a well-documented case of an auto repair rip-off.
Resolving Complaints Tears, angry letters and threats might get your once-friendly dealer to fix your new car correctly while it’s under warranty. But if you’re not getting satisfactory repairs from the dealer, follow these steps and you’ll probably get better results: First, write as concisely as possible a letter of complaint to the dealer’s general manager or owner. Make sure you do this while the vehicle is still under warranty. Make sure, too, that you keep all your repair records and copies of your correspondence. Second, if the dealer can’t or won’t resolve the problem, ask the automaker’s “zone representative” to intervene. Ask the dealer for the zone office address; it may also be listed in your vehicle’s owner’s manual. The zone rep can authorize additional repairs or take other steps to resolve the dispute. Third, if the zone rep won’t help, contact the automaker’s owner relations or public relations department. Again, your owner’s handbook should list the address. Ask for their suggestions on how you might proceed to get your car fixed to your satisfaction. Finally, if you believe the defects of your car are serious, and if you would like the automaker to either replace the car with another or give you a refund, you can take action against the automaker under your state’s so-called lemon law.
