Tuesday, December 20, 2011

Riding on Free Service and Extended Warranty

If you have a car model that's not a hot-sell, you can expect to increase sales with free servicing and extended warranty. This is the "trick" car manufacturers resort to in order to increase the sales volume of their slow going models.

A good example is Ford. For the longest time, Ford cars had been trailing Japanese and Korean makes when it comes to sales volume, until Ford wised up and started offering 3 years free service to go with its 3 years warranty. As a result, Ford Fiestas have become a common sight on Malaysian roads.

Note that it doesn't matter if Ford cars are good or bad. The fact that they now come with 3 years free service means that Fiesta and other Ford owners don't have to worry about expensive servicing costs associated with Ford cars.

There is also another benefit that comes with the 3 years warranty. More Ford cars on the roads means better economies of scale for Ford's supply chain. So, when the 3 years are over, replacement parts for "now popular" Ford cars would be easier to obtain and more affordable (I don't know why the heck Ford didn't do this when I owned the quirky Ford Focus S2.0 hatchback that needed expensive replacement parts).

And if a car model is really slow moving, some manufacturers offer 5 years free service and warranty, e.g. the Peugeot 207 sedan. Imagine having to pay nothing for servicing for 5 long years and imagine not having to worry about expensive replacement parts for the next 5 years. Awesome!

Provided, of course, you can live with the difficult-to-like Peugeot 207 sedan's looks...


  1. More companies are starting to offer a better and longer car warranty with their vehicles. It gives you more time to find a reasonably priced extended warranty, and is also great because it means more coverage from the manufacturer for longer!

  2. Pretty good post. I just stumbled upon your blog and wanted to say that I have really enjoyed reading your

    blog posts.

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  3. Thanks :)

    I love to talk/write about cars, but I have very little time to do so these days.

    Will try to keep it up, though.

    So, thanks again for the encouragement.

    1. Hi, just stumbled onto your blog. Found it quite refreshing-layout and words used.
      Your comments on cars and non-car matters are very good.
      You are very knowledgeble and straightforward.
      I do wish you could keep it up.
      Thanks again for a really nice blog.


  4. Hi there! great stuff, Thanks for sharing a very interesting and informative content, it helps me a lot, keep it up!
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  5. I think offering an extended warranty is pretty common practice. I never used mine, but it is nice knowing that if I needed it, it will be always there.

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  6. All good extended warranties allow you to have your car repaired at any repair facility. Do not buy a warranty that restricts you to only their repair shops or their dealerships.