Warranty Recovery

Tips for maximizing fleet profitability through a formalized program


Sadly, many fleets don’t collect much or any warranty at all, he says, and there are fleets that pay for extended warranties and never collect on these either.

FORMAL PROGRAM

“If you can’t track warranty, you can’t not manage it,” emphasizes Stuart.

Without a systematic process to properly track and manage warranty recovery, a fleet has no way of tracking the overall costs of the vehicles, says Tabel of Isuzu. Many fleets today have several truck brands in their fleets and each truck OEM has its own specific policies for warranty claim processing and payment.

Adds Kenworth’s Kalkoske: “Customers should know where each vehicle is in its warranty period so that they don’t pay for repairs that are actually covered under the vehicle or component warranty.”

Without a formal warranty recovery program, all trucks and components could easily be considered equal, when in fact, that might not be the case,” Eaton’s Needham says. “Additionally, fleets are constantly looking for the highest quality product in order to minimize the amount of time a truck is down for repairs. A formal program provides the data to support that.”

“A warranty tracking program is also a product quality tracking program,” Bergeon of Eaton adds. “That data should be used to engage with the OE to identify potential product improvements and help drive a solution to any issues.

“A warranty tracking program also can be utilized to identify potential areas for training, either because the operator’s practices may be a contributor to claims or because a higher repair frequency will benefit from additional technical expertise.”

PROGRAM ELEMENTS

The essential component to a successful warranty recovery program is information, maintains CASCOR’s Matosky. Fleets must understand the three Cs: complaint, cause and correction.

He advises including OEM parts and labor information, accurate mileage and some level of comments on every repair order opened – no matter whether it is a warranty repair, a PM or an outside repair.

“Complete information is the key to a well run fleet,” he says, “because it helps a fleet fully utilize the investment it makes in the vehicles it purchases, in its costly fleet management systems and in the expensive people hired to repair and manage the fleet. If the right information is input on each and every repair order, a fleet can report against this information and keep a pulse on how it is doing in real time.”

Kalkoske of Kenworth recommends having dedicated people assigned to warranty administration. “Having a person knowledgeable of the various warranties that may apply to a fleet’s vehicles will reduce confusion over what is and isn’t covered and for how long, and will help the fleet customer avoid unnecessary repair costs.”

Isuzu’s Tabel agree. “Because each OEM has its own warranty policies – and they can vary, the more knowledge and experience a warranty administrator has, the more likely the fleet is going to be properly and timely reimbursed.”

Moreover, there needs to be “follow up to insure that claims are paid timely, and that what a fleet submits for reimbursement is in fact what is paid,” continues Tabel.

For claims paid short, he suggests that fleets should demand the OEM explain why the claim is being paid for less then what was applied for.

“In large fleets (400 vehicles or more in operation), it is necessary to have one or more people assigned to the task,” he advises. “This is not a part time job. Warranty repairs can be thousands of dollars and the new vehicle purchase price includes the OEM’s estimated warranty cost per vehicle. A fleet pays for the warranty and they deserve to be fairly reimbursed for their work.”

“Successful warranty administrators should include as much rigor as is reasonable at the repair point and include detailed repair information and coding,” asserts Eaton’s Bergeon. “It should also include a feedback loop to the repair point on all claim denials and the reasons for it.”

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