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Long warranties and selling - P3t3r

I've noticed that many dealers are offering very long warranties. Some are 5 years, one is 7 years, and one is now doing a 100,000 mile lifetime warranty.

A lot of people sell their cars after just a few years because they think it's going to start costing lots of money. I wonder whether these warranties will make any of these people keep their cars for longer? Replacing a 3 year old car seems like a big waste if it has another 2+ years warranty. I suspect these people will still continue to replace their cars every few years though.

Long warranties and selling - primeradriver

And this is why the bigger manufacturers have been slow to react to the challenge of the Koreans over the last few years.

Very few buyers of "mainstream" cars keep them very long. Most sold are to fleets, or company car buyers. Such buyers don't care about warranties beyond three years. Ford et al reacted to Mitsubishi offering 3 years because few people only keep cars a year, so the two extra years counted for something.

But 5, 7, infinity years? These only benefit private buyers who keep their cars a while. That's great for some manufacturer profiles, but for the like of Ford it is simply a noose around their neck, as the fleets don't care, and Ford doesn't care too much about private sales (most of which are at considerable discount anyway), and Ford would only end up having to pay for a pile of claims from second owners, for no real benefit.

Which is why, having thought about it for a bit, this Vauxhall "lifetime" warranty is such a stroke of genius. It costs them not one dime from their core market, as the fleets won't care one way or another and the second owners don't get any benefit, and the few long-term owners won't cost them too much in the grand scheme of things.

But, at the same time, they can lay claim to having the "best" warranty.

They're not stupid in Detroit, are they?