GM announces 5 year/100,000 Powertrain Warranty

cfromc

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Sorry, here is the wording: DETROIT -- General Motors is increasing the powertrain warranty on all its 2007 model vehicles sold in the United States and Canada to 5 years or 100,000 miles, the automaker said today. The powertrain warranty is transferable, without a fee, and has no deductible, GM said. Previously, GM's powertrain warranty typically was for three years or 36,000 miles. GM said the new warranty terms would apply to 2007 models already sold. The automaker is also extending the terms of its roadside assistance and courtesy transportation programs along with the new warranty coverage. "This isn’t going to be cheap, but we think it’s going to be more effective for where we are today," GM CEO Rick Wagoner said at a press conference. "We think it’s manageable within the cost conditions we’ve laid out." Wagoner said such a move is possible by the quality gains GM has made over the past several years. "It was a lot more costly five years ago than it is today, particularly in the powertrain area," Wagoner said. "Over the past seven or eight years we’ve communized on powertrains, we’ve really had a chance to move the needle up on our quality and performance." GM set up a web site -- www.gm.com/warranty -- with details of the program. Among the changes, the new warranty eliminates the $100 deductible on repairs for trucks equipped with the DuraMax diesel engine. The move is a bid by GM to counter successful marketing of long-term warranties by competitors such as Hyundai and Kia. In July, rival Ford Motor Co. increased the powertrain warranty on Ford, Mercury and Lincoln vehicles for 2007 models. The warranty is five years or 60,000 miles for Ford and Mercury vehicles, and six years or 70,000 miles for Lincoln vehicles. "What we’ve found is that two-thirds of customers trade or dispose of the vehicle before five years and 100,000 miles," said Mark LaNeve, GM's vice president of vehicle sales, service and marketing. "This really matches the way customers buy cars."
 
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This is a good thing that should positively affect public opinion of GM. On a somewhat unrelated note, I was at that press conference. It was a big media event with a podium set up on the Detroit Riverfront in front of a large selection of cars and trucks, including the new Saturn Outlook, GMC Acadia and Buick Enclave. They were handing out free Dove and Haagen Daas ice cream. It was quite a circus. Let me tell you, though, the new SUV's I mentioned REALLY look good, especially the Buick, believe it or not. They should be big hits. http://www.buick.com/enclave/index.jsp
 

Kestas

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They do this at every downturn of business. Instead of lowering the price to move vehicles, they sweeten the warranty. It'll cost them more, but the extra cost will be borne 3-5 years from now, when hopefully business is good and they can bear the extra cost. The last paragraph is just executive palaver. The real reason is what I just mentioned above. It'll be back down to 3y/36K or 5y/50K when nobody's watching. Remember the 7/70 Chrysler had at the last downturn? Whatever happened to that?
 
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SE Pa
Well, it worked for Lee Iacocca with his 7/70, so maybe it will work again. I think FoMoCo should go to 8/120 if they really want to impress buyers in the short term. The extended warranty promo has always been a good way to defer and amortize the incentive costs to keep cash flow healthy in the short term. Better for the manufacturer than throwing cash at the customer in the showroom.
 
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Dallas, TX
Funny to remember Chrysler's 7/70 offering, back when quality was only fair. Seems like they'd have success with it now that their quality is better.
 
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quote:
Originally posted by CBDFrontier06: Funny to remember Chrysler's 7/70 offering, back when quality was only fair. Seems like they'd have success with it now that their quality is better.
Longer waranties are usually trotted out when acar company has earened reutation for building unreliable cars. Chrysler started it with the revolutionary 5 year 50,000 mile warranty way back in the late 60s or early 70s becuase they were having a lot of powertrain problems. Hyundai came out with their long warranty because they had a well earned reputaion for building **** cars and they needed something to give buyers some confidence. I don't think GM is in that boat. This does look like a good deal for buyers and shouldn't cost GM an unreasonable amount of money. They need to do something to wean buyers off the expectation of fire sale level rebates all the time. The warranty may not be the answer, but it's step in the right direction. The main thing they need is a product line that interests more people enough to buy for reasons other than patriotism or out of pity.
 

ALS

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Pittsburgh
With the quality of American cars being what they are it should be 7/100K miles across the board. There is no reason that any American car can't last that long with regular maintenance. How many of you have 100K plus on YOUR GM, Ford, and Chrysler on this board? Get my point?
 
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12,385
Location
Northern CA
quote:
Originally posted by ALS: With the quality of American cars being what they are it should be 7/100K miles across the board. There is no reason that any American car can't last that long with regular maintenance. How many of you have 100K plus on YOUR GM, Ford, and Chrysler on this board? Get my point?
My 110k+ 1995 GMC wouldn't have cost them much for a powertrain warranty, which is what the long ones usually are. All the little ash and trash that has fallen off or quit, and multiple AC failures would have cost them a few hundred bucks but not broken the bank.
 
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11,633
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Illinois
Question, do these powertrain warranties cover the electronic goodies that make the powertrain go, or does this just cover internally lubricated parts (BITOG related content, LOL) ?
 
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Senoia, GA
Chrysler only offered a 7/70 with a 12/12 bumper to bumper. You want to impress me, GM? Cover the fuel pumps, ABS sensors and dashboard gauges for 8/100k.
 
Messages
12,385
Location
Northern CA
quote:
Originally posted by totttalled: Cant you buy an additional powertrain 100K warranty for like $800 at the dealer on ANY car?
Always look online. Dealers typically hose you one the price, butthere is usually a dealer someplace in the US that likes to sell extended "warranties" online at a low profit. The "" is because they are really extended service contracts instead of warranties.
 
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1,203
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Oregon
I usually keep a new vehicle at least 10 years or more unless its a problem child so I would be much more impressed if it 7 year 100,000 BASIC bumper to bumper warranty on the vehicle. Instead of a 60 month power train warranty.
 
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11,633
Location
Illinois
I have a great idea. Stay current on your payments, and GMAC will provide maintenance and warranty as long as you are making payments on your GM automobile. So if you take the 7 year 0% or whatever, GM/GMAC will provide warranty coverage and scheduled maintenace, not including wear items, during that 7 years, as long as you are current on your payments, regardless of mileage. Perhaps a $50 deductable after the 36mo/36kmi standard warranty. Oh, and a service loaner too. Of course, that would mean Mr Goodwrench would be changing oil. But it would also drive a lot more folks into the dealership. (Many new cars are bought while the trade-in is in the service bay!)
 
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