What Car Warranties Mean

We love our new cars, and we should, since we spend so much money on them. It doesn't matter if it's something cheap or an expensive BMW, we treasure it. We wash and polish them, and fret over every little ding and rattle. We believe we're safe because of the warranty. But are we really?

Whenever you buy a new car, it comes with a warranty. This is known as the manufacturer's warranty, and can run for up to three years. You might also be offered the chance to buy a "dealer-based extended warranty," which covers you for a longer period of time. That sounds good, but be careful - they often contain limitations on such things as mileage. Don't sign until you've read through everything carefully, and don't be afraid to ask questions.

Warranty Questions

Most of us don't think about it, but consider shopping for warranties as well as price. Why? Well, the simple fact is that what you'll spend after the sale comes to about 40% of what you'll spend on the car over its life, so a good warranty can save you money. Warranties vary tremendously, so you should always discover how long it lasts and what it covers.

With a dealer-based extended warranty, find out when it starts, and exactly what it covers - is it every fault? What happens if you can't get your car serviced exactly according to the approved schedule? If you have an accident and then have your car repaired, does that affect the warranty?

Servicing

Obviously, your car has to be serviced regularly. But these days you're not forced to have it done at the dealer, as cars are no longer sold with "servicing ties." This means you can have your car serviced anywhere and the new car warranty is still good. The only condition is that it has to be to the manufacturers' recommendations. Since independent garages are usually cheaper than dealers, this could mean a significant savings over the life of a car.

This isn't necessarily the case with the dealer-based warranty that you buy. The restrictions in that might mean you have to have your car serviced by a dealer at the intervals specified in the owner's manual. If you don't conform to that, you could find that the warranty becomes null and void.

Warranty Problems

In the event of a problem with a warranty, contact the manufacturer (the customer helpline number will be in your handbook). In most cases they'll be willing to resolve everything smoothly. If not, contact the Society of Motor Manufacturers and Traders (SMMT), which can act as an arbiter in the situation, although it carries no legal power.

If that doesn't work, contact Trading Standards. As a last resort, contact a solicitor. If you have to take the manufacturer to court over the warranty, it'll be an expensive journey, since your claim won't qualify for the small claims track. If you win, you can claim costs and you might even be able to claim compensation.