Capped price servicing: what you need to know

car servicing


Posted June 18, 2024

Capped price servicing programs can give car owners and buyers peace of mind and more transparency around the costs of vehicle maintenance, but do they help you save money over the long term?

For many car owners, the potential for unexpected parts and labour costs can be daunting when taking their vehicle for a regular service. The perception of expensive aftersales costs may even impact car buying decisions, and put buyers off signing on the dotted line.

To address these concerns, most car brands in Australia have introduced capped price servicing programs designed to give owners and prospective buyers more certainty about the costs involved with servicing in line with the recommended intervals.

Here's what you need to know about capped price servicing programs in Australia, and whether they should factor in to your decision to buy a new or used car. For immediate help when you notice an issue with your vehicle, ensure you have emergency roadside assistance in place.

What capped apped price servicing means for new and used cars

What is capped price servicing?

Capped price servicing specifies to the buyer of a new car how much it will cost for a service - encompassing inspections, checks and replacements - to be completed at set kilometre or time intervals by an authorised dealer representing that manufacturer.

Dealers have an agreement with the brands they represent not to charge more than the capped price service amount, although they can charge less (it almost never happens).

The deal can run for as little as three years, or in some cases, capped price servicing agreements can even cover the entire lifespan of the vehicle.

Are all capped priced servicing programs the same?

While they usually exclude wear and tear items such as brake pads and tyres, capped price servicing programs can otherwise be quite varied. It’s up to the manufacturer of the car to decide what items are included in the capped price and what items are excluded.

It’s worth comparing the full logbook service specified by the manufacturer versus what is included under the capped price. You may find that some items critical to ongoing warranty coverage are actually outside the capped price servicing scheme.

Car servicing

Make sure you know what is and what isn't included in your servicing agreement. Image: Getty

Why do capped price car services vary in cost?

Prices vary between capped price services because different schemes include different services and parts. Different cars within a brand’s line-up also vary enormously in their technical specification, so that in turn affects the cost of the service and potentially, their frequency.

The cost of the service can also be subsidised to a greater or lesser degree by the brand or dealer network in an attempt to woo more buyers. Some of the cost of the capped price program can also be built into the purchase price of the car. 

It’s not a universal rule, but it’s worth bearing in mind the more expensive the purchase price of your car, the more expensive the service cost often is as well.

Does capped price servicing make the car cheaper to own?

It's worth considering service intervals when comparing capped price servicing costs from different brands. If two cars cost $300 per service, but one requires a service every six months or 10,000km, and the other requires every 12 months or 15,000km, then the one with the longer service intervals is inevitably going to cost less over time to maintain.

Should you ask for a service outside of the capped price service checklist, expect this to be done at an additional cost. To avoid surprises at the end of the day, make sure you request and approve an estimate for any additional work, such as tyre rotation or extra diagnosis, before you commit. You may find extra jobs add significantly to your final service costs.

Does capped price servicing apply to used cars?

The capped price servicing program is usually tied to the VIN (Vehicle Identification Number) of the car rather than the owner, which means ongoing capped price servicing coverage can be an attractive feature when it’s time to sell the car on the used car market.

However, while privately-owned used cars qualify for capped price servicing coverage, many that come out of private and government fleets do not. So, it's important to always check out the history of the car you’re buying.

It's also important to be aware of modifications to your vehicle or car you're thinking about buying. Modifications and changes to the car's body, engine, suspension, and other components can void capped price servicing agreements.

How much will car servicing cost once the capped price period has expired?

Once the capped price servicing period has expired, it’s up to individual authorised dealers to determine how much to charge you for servicing. That means there can be big differences getting the car serviced by different authorised dealers outside of the capped price period.

Also be aware that major and expensive services can sometimes occur soon after the capped price limit. Toyota, for example, has among the cheapest capped price servicing program, but the prices can leap on some models for later services.

It’s worth checking online calculators to ensure there are no shocks when you do go for a post-capped price servicing service. You can ask the authorised dealer for a quote before checking the car in for a service outside the capped price service duration, or engage an independent repairer.

Do electric cars come with capped price servicing?

Electric vehicles generally require less frequent and costly servicing compared to petrol and diesel cars. In fact, scheduled service intervals for some electric vehicles can be as long as two years, with far fewer mechanical parts to check. As a consequence, capped price servicing isn't always offered by manufacturers for electric cars.

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