Australia's Best Cars

Understanding warranties

When you’re shopping for a new car and comparing safety and comfort features, fuel economy, performance and the all-important price, don’t forget to check out the warranty.

Like most aspects of the Australian automotive retailing scene, the competitive nature of the business means the warranty offer from different vehicle brands continues to improve.

It wasn’t that long ago two-years/ 50,000km was standard. Now that’s commonly around three years with unlimited kilometres, and offers are as generous as Kia’s industry-leading seven-years/unlimited kilometres.

Vehicle manufacturers don’t only use warranties to attract us into the dealership. They use them to keep us spending there for as long as possible after the purchase, as part of an after-sales regime that now often includes fixed price servicing.

Warranty offers from manufacturers are voluntary and above and beyond the statutory protection and consumer guarantees that new car buyers have under Australian Consumer Law.

Essentially, the manufacturer warranty is a guarantee, protecting vehicle buyers from faults and defects for a set amount of time and/or distance.

It’s always a very good idea to have a careful look at the warranty to understand what’s included and what isn’t, and what your rights and responsibilities are. For instance, consumables such as tyres aren’t usually covered by warranty, nor interior wear and tear or defects arising from an accident or vehicle misuse.

But despite statements that come from some dealers and manufacturers, your warranty is not automatically voided by getting your vehicle serviced by a reputable independent mechanic.

Going that way is often a cheaper option than with the dealer and a list of good, independent mechanics and service centres can be obtained by checking with state-based motor trader associations or auto club.

But you must service your car in line with the schedule and specifications in the car’s manual or warranty logbook.

Your warranty also stays intact if you use non-genuine parts, but for ease of mind, reliability and safety ensure they come from a reputable manufacturer and supplier.

If you are planning to keep your vehicle for a long period, then an extended warranty might be worth considering. These usually commence when the standard manufacturer warranty ends. They are offered by both the vehicle brands themselves and independent suppliers.

Again, it is very important to read the conditions, inclusions and exclusions of these warranties. For instance, they may not cover as many items as the original warranty, and sometimes they specify servicing at an authorised dealer only.

Generally, if you sell your car while it is still under the manufacturer’s warranty, the remaining warranty period passes onto the new owner (unless the warranty states otherwise).

However, an extended warranty does not normally pass on to the new owner. In such cases, you may be able to cancel the extended warranty and get a refund for any coverage you had left. You may have to pay an early cancellation fee.

Written by Bruce Newton
February 21, 2017