Most manufacturers offer to extend warranty for 2-3 more years after the initial 3-yr period for some finite amount of money (varies for models but often £250-£600/yr range for most cars).
So, it seems that if they like, they can easily offer 5-yr warranty from very start.
Why they are not doing it - especially when some competitors like Daihatsu, Hyundai & Kia already offering longer warranties?
A car sales man will often say "oh, Honda is so reliable, it doesn't need extended warranty as it won't break down ever...." - but shouldn't they then throw longer warranty if they are confident that their cars won't fail at any time?
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The cost of warranty claims is factored into the selling price of the car. Because of lower wages and other manufacturing costs in their country of manufacture, the selling price of Daihatsu, Hyundai and Kia etc is low enough for them to be able to give a long warranty and still be competitive in the UK. If they gave a shorter warranty they would be able to reduce the price. If all cars were made in the Far East then they would all be competeing on a level playing field and you probably wouldn't see big differences in the length of warranties. Just think yourself lucky you live in a country which has a high standard of living.
Edited by L'escargot on 06/02/2010 at 09:26
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Its down to marketing. If they can sell cars with shorter warranty then they will.
Kia ceed is made in Slovakia with parts mainly made in eastern europe. Audi TT is made in hungary from parts largely made in eastern europe. Kia has more than double the Audi warranty.
In some countres (US) a lot of cars come with a 5 or even 10 year warranty.
Our experience is that Kia/Hyundai are at the top end of reliability so I dont think the warranty costs them a great deal. If Renault or Puegeot offered a 5 year warranty it would bankrupt them.
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Daihatsus are made in Japan.
Suzukis are made in Hungary. Kia in Slovakia (now all Kias come with 7-yr warranty).
Most Hyundais are made in either India or Korea.
Mercedes make cars in Germany, South Africa & India.
Nissan & Hondas are made in UK.
So, where the cars are manufactured have little to do with warranty.
Perception about brand takes years to be built. A large number of buyers still buy Ford/Vauxhall/Honda etc. just because they always bought the same brands.
There must be some mathematics behind warranty calculation which we don't know. Otherwise there would not have been such disparity among warranty lengths.
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Daihatsus are made in Japan. Suzukis are made in Hungary. Kia in Slovakia (now all Kias come with 7-yr warranty). Most Hyundais are made in either India or Korea. Mercedes make cars in .......... South Africa & India.
How many of these countries enjoy the high wages and standards of living of the UK?
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Japan (& S. Korea is not far behind) ??
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> How many of these countries enjoy the high wages and standards of living of the UK?
Japan's standard of living is a damned sight higher than this little island. South Korea is not far behind.
Granted SA, India and Hungary have a long way to go.
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>>If Renault or Puegeot offered a 5 year warranty it would bankrupt them.
But if, say, a company like Warranty Direct can offer warranties - esp. the expensive type of 'cover-all' types - on these cars, why couldn't the manufacturer simply factor in the effective price of this at sale time?
A third party warranty is only an insurance policy & premiums can be calculated (by risk of intervention) like any other insurance policy premiums - whether by OM (as their bundles warranty) or with third party suppliers (with their off-the-shelf warranties).
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Peugeot are offering new 308s here for €130 per month with a four year guarantee, including servicing costs and parts.
BIG
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