Cunningham Chrysler-Dodge-Jeep of Edinboro has a secret weapon in closing the deal on new and used cars: an extended powertrain service contract that is offered on almost all the vehicles the Pennsylvania store sells, covering the powertrain for up to 80,000 miles.
The service contract has been most effective in the used-car department, where sales are up about 30 percent since 2012, said Mike Cuzzola, Cunningham's general manager. Cunningham started the program in 2013.
This year, he said, the store is on track to sell about 900 new and used vehicles, and the split is 50-50.
The service contract costs the store $299 per vehicle, which is rolled into the selling price. It has been key to cinching the deal for customers who are on the fence with a purchase, Cuzzola said.
On new cars, Cuzzola explained, the additional service contract begins when the factory warranty expires. On used cars, it gives customers peace of mind that they won't have to face a car payment and a repair bill if something expensive breaks, he added.
The service contract offer comes as Fiat Chrysler is trimming its warranty coverage. For 2016, the automaker has reduced the powertrain coverage in its warranties to 5 years/60,000 miles on most of its vehicles, from 5 years/100,000 miles previously. FCA also offers 3-year/36,000-mile bumper-to-bumper coverage on most of its new vehicles.
With 80,000 miles of powertrain coverage on new cars, most customers won't see a repair bill, as most don't keep a vehicle long enough to accumulate that many miles. But if something does break, the most they will pay is the $200 deductible.