Fleet practitioners should diligently follow the vehicle manufacturer’s recommended maintenance schedule to maintain factory warranty coverage. Failure to comply with prescribed preventative maintenance (PM) services associated with vehicle warranty will place significant pressure on eligible coverage. In effect, non-compliance could lead to rejected claims, higher fleet costs and potential liability issues.
Warranty coverage and claims are now under constant scrutiny by a number of vehicle manufacturers due to the high revenue reserves required to honour claims. Mike Antich, Editor and Associate Publisher of Automotive Fleet, states that some truck manufacturers hold nearly 3% of their turnover to cover warranty costs. In other research, Warranty Week, an online newsletter for warranty management professionals, recently surveyed 232 US-based vehicle makers and found that manufacturers are holding an average of 22 months of reserve funds sufficient to pay all claims that may be submitted at some point.
These ever-increasing warranty costs and associated reserves are putting original equipment manufacturers (OEMs) under enormous market pressure to reduce claims. This in turn is leading to a growing trend of denied warranty claims for reasons such as PM guidelines being overlooked by fleet personnel, complete maintenance history not being recorded and other instances.
There are a multitude of reasons why warranty claims are being denied. In a recent example, a NSW Council experienced an engine failure in a haulage truck at approximately 300,000kms. When the OEM downloaded the engine data in response to the filed warranty claim, they refused the claim due to excessive idle time.
Why would the warranty claim be denied for excessive idle time?
In this case, there is a direct relationship between idle time and corresponding kilometres of driving time. The equivalency is about 1 hour of idle time to 50km of driving time. When the OEM downloaded ECU data, the idle time increased comparable kilometres by more than 2.5 times to 800,000kms. Of course, the OEM deemed these figures to be outside reasonable wear and tear and therefore refused the warranty claim.
Clearly, in the example, fleet practitioners need to be aware that excessive engine idling can be used to determine powertrain warranty claims as it affects engine hours, not just fuel consumption.
In addition, many vehicle manufacturers will require the complete maintenance history to assess warranty claims therefore PM compliance must be considered as a critical KPI in the maintenance of your fleet.
Depending on the OEM, complete maintenance history can include the following items:
- Completed work order or job card including signed check list or OEM handbook
- Name of the technician that completed the work
- Parts utilised including brand of parts and actual part numbers
- Oil and lubricants utilised including brand and type
- Oil, coolant and fuel analysis history, and
- History data available on the plant, vehicle or equipment ECU (s) in some cases
There may be other target areas that are scrutinised as well such as vehicles with diesel emission systems. In certain applications (such as low speed, low load as often seen with utility or Council type fleets) these types of vehicles may not reach high enough operating temperatures for sufficient time periods to fulfil regeneration cycle requirements. This can have detrimental effects on engine components such particulate filters and other elements of the emission system. Diesel particulate filters (DPFs) can become obstructed if they are unable to remove soot and nanoparticles from the DPF. Other systems such as selective catalytic reduction (SCR) and diesel exhaust fluid (DEF) systems are also at risk and could ultimately effect warranty claims.
The bottom-line for fleet practitioners should be to meticulously follow OEM vehicle maintenance and operation recommendations. Otherwise, lax fleet departments may be putting their organisation at risk of losing factory warranty coverage on vehicle assets leading to undesirable outcomes.