General Motors’ dealers don’t seem especially disturbed by the automaker’s decision to scale back its powertrain warranty and free maintenance visits on Buick, Chevrolet and GMC vehicles.
Dealers found out last week GM will trim the factory powertrain warranty on Chevy and GMC vehicles from 5 years/100,000 miles to 5 years/60,000 miles, starting with the 2016 model year. The automaker will also cut in half the number of no-charge oil changes on Buick, Chevy and GMC vehicles in the first two years of ownership or 24,000 miles to two, from four.
“Do I think it’s going to affect our business? No,” Steve Rayman, owner of Steve Rayman Chevrolet in Smyrna, Ga., told Automotive News.
If anything, dealership executives say, the shorter powertrain warranties could make it easier to sell extended-service contracts.
“It sure can’t hurt,” said Mike Zorn, service director at Classic Chevrolet in Grapevine, Texas. “People are still going to want an extended warranty.”
Other dealership staffers agree.
“I love it. All manufacturers should just get rid of all warranties,” was one comment on the “Ethical F&I Managers” Facebook page this week. “Oh yeah 2016 gonna be a GREAT YEAR!” was another.
‘Irrespective’ of F&I
Did GM change its powertrain warranties with service contract sales in mind?
GM took over the sales and marketing of its Buick, Cadillac, Chevrolet and GMC brand F&I products in October to increase sales volume. At the time, the automaker said sales penetration of the products had been below par under captive finance company GM Financial.
However, GM’s warranty decision was unrelated to its desire to sell more F&I products, according to Robert Wheeler, GM’s communications manager for fleet, commercial customer care and aftersales.
“The GM decision to modify the Chevrolet and GMC powertrain warranties was made irrespective of the F&I business,” he said.
At least one dealer isn’t happy that GM is cutting back on no-charge oil changes.
Jim Lewis, owner of Lewis Automotive Group, including Lewis Chevrolet in Garden City, Kan., said it’s especially important early in the ownership experience to get customers in the habit of coming to the dealership for service.
“It makes no sense to cut back the oil changes,” he told Automotive News. “I’m telling you, that has helped.”
But Lewis and Classic Chevrolet’s Zorn both said they could see the logic of cutting back the powertrain warranties, especially since Ford Motor Co. didn’t follow GM’s lead when GM upped the warranties to 100,000 miles, starting with the 2007 model year.
“Ford isn’t doing it,” Lewis said. “So I don’t blame them.”