Warranty claims and returns continue to be a major headache for the aftermarket. But for the most part, the problem is not with the quality of the parts but in diagnostic and installation errors as well as a general lack of teamwork and communication throughout the distribution chain.
Warranties vary greatly by category, ranging from 90 days to five years and lifetime guarantees. There also can be substantial variation within individual product lines, with batteries cited as one of the most widely differing segments.
Most retailers don’t offer coverage beyond the manufacturer’s warranty, thus having little incentive to reduce claims. The same goes for installers, jobbers and WDs.
For their part, many manufacturers calculate less than half of the parts returned for alleged defects actually have any problems. And some electronic suppliers and makers of other complex systems estimate the erroneous claim rate to be more like 90 percent. However, manufacturers still tend to accept parts back with no questions asked so not to risk losing business and do relatively little tracking of in-field performance.
The good news is the durability of aftermarket parts has increased dramatically in recent years, according to Frank Hampshire, director of research at the Motor & Equipment Manufacturers Association (MEMA). If a part does fail, he points out, the warranty usually has expired.
At Crown Remanufacturing Inc., the number of non-defective warranty returns has jumped to 51 percent this year vs. 40 percent in 2002, according to Walt Ruba, the company’s vice president of engineering and development. But he says overall warranty claims have come down somewhat in recent years due to quality improvements.
ISO-certified could help
To help keep warranty claims down, Eastern Catalytic in Langhorne, Pa., only buys components from ISO-certified suppliers. It also has launched a new Web page to better disseminate product information.
Less than 3 percent of the company’s catalytic converter sales are returned for warranty issues. Although the overwhelming majority of these comebacks emanated from engine problems or defects in other components, Gil Emery, Eastern’s catalog manager-technical director, says it’s usually easier to replace the converter (at cost) then to send the problem back down the distribution channel.
In some cases, though, continued misdiagnosis and shoddy repairs by installers can lead to the converter being replaced three or more times before the root issue is addressed. This rarely happens at larger shops, Emery says, noting mechanics in these facilities usually have good diagnostic tools and know how to use them. But, he complains, some smaller installers don’t try to diagnose the problem or they simple work off another shop’s write up when customers price shop.
They would rather make a quick fix, Emery says, than spend a little time analyzing the situation to ensure the job is done right. To complicate matters, these facilities may be working off catalogs that are several years old.
Misdiagnosis and unnecessary repairs are only part of the problem. WDs using return allowances to clear slow-moving inventory, manufacturers allowing them to do so, mislabeled parts and catalog inaccuracies also are contributing factors. And there doesn’t appear to be a simple solution in sight.
Plenty of blame to go around
“There’s enough blame to go around,” attests Mitch Schneider, owner of Schneider’s Automotive Repair in Simi Valley, Calif. “I’ve seen some improvements, but generally the industry still hasn’t done a good job to ensure the right part is ordered the first time. That’s why we have return rates as high as 30 percent or 50 percent.”
Time constraints and poor planning feed the problem, Schneider says. Most jobbers don’t have a formal process or form for repair shops to use and installers sometimes are too busy to do the necessary legwork.
Although Schneider declares that it is reprehensible to use any kind of part as a diagnostic tool, he believes, to some degree, the industry has been trained to do just that. “It’s not something shops want to do, but it is expedient.”
Problems caused by misdiagnosis can vary greatly by product category. The rate tends to be higher in complex systems such as an HVAC unit, for example, in which all the components are inter-related and need to be tested separately and as a unit. Even if the correct repair is made, problems still may arise from topping off the refrigerant with a slightly different blend than had been used previously, warns Mary Beth Kellenberger, an aftermarket industry analyst at Frost & Sullivan.
“If a technician doesn’t look up and down stream in a closed system when diagnosing and making a repair, this could undermine how the new component performs and result in premature failure. There are a lot of potential non-compatibility issues,” she says.
In the case of HVAC-related fixes, she says, manufacturers want installers to treat the accumulator/dryer like an oil filter and replace it every time any part of the system is worked on. Some are even tying future compressor warranties to this, making installers show the proper paper work to prove the accumulator or dryer was replaced the last time around before reimbursing them again.
Delphi Corp. suggests installers should always use wireless diagnostic tools, whether preparing for a major repair or merely changing the oil. Delphi’s system checks for out-of-specification codes and data parameters. This will help identify potential problems before they cause any damage, advises Mike Simon, Delphi’s national manager for integrated service solutions. Technicians are encouraged to greet customers at their vehicle and conduct a preliminary diagnostic scan at this time. As needed, mechanics can talk directly with Delphi experts via a headset as they are working on the vehicle. Technicians also can view schematics on a 8.5x11-inch handheld monitor.
“We want to make information more accurate and accessible to the installer and counterperson,” Simon says. “Not only does the part number and information on the box have to be correct, accessing additional data also has to be made easier.”
A systems approach
Crown’s Ruba also stresses a systems approach. To this end, the supplier provides detailed instructions for mechanics working on the distributor. The checklist includes checking the idle, timing and voltage rates. Skipping steps can result in serious problems. On some Mazda vehicles, for example, Ruba says the reference voltage is between 0.9 and 5 volts. When this isn’t followed, the system likely will fail within a few weeks.
In fact, Ruba says a lot of failures stem from secondary high-voltage coils for rotors, wires and plugs. Clogged PCV valves and optics also can wreak havoc on distributors.
In hydraulic components, it’s critical to flush the system before making any repairs. This prevents debris from settling, which can clog the system and blow the seal. But in some vehicles, the pressure and the return side of the line feeding the units have the same size thread. As a result, mechanics can easily attach the wrong hose by mistake.
Although electronic cataloging holds a lot of promise, not all the kinks have been worked out yet. “It will be good when everyone is using them,” Schneider says. “But our shop still has problems ordering the right parts — and we’re very careful. We even developed our own form to reduce potential errors. However, a lot of places don’t have the infrastructure to do this.”
Mike Gordon, an assistant manager at Sanel Auto Parts in Hilsboro, N.H., is more critical. E-catalogs too often are wrong or confusing, he says, due to inputting errors and a poor format. One example: There is no code sheet on how to decipher General Motors’ information labels.
Not only is he finding errors, Gordon also faults the correction process — or apparent lack thereof of one. During the last 14 months, he has notified catalogers and manufacturers of 18 errors. To date, none have been corrected. “There is a breakdown somewhere. A lot of smaller manufacturers may not be listed or their information is just plain wrong. I trust paper catalogs more (than electronic ones),” he says
On the other hand, Siemens VDO Automotive has had a positive experience with electronic catalogs. Product Manager Dave Maclay says errors stemming from misdiagnosis have dropped dramatically since the supplier began providing information on its power window motors and radiator fan/blower motors four years ago.
“The thing we noticed the most is a reduction in tech line calls. All the necessary information now is available to the counterman directly through the catalog,” says Maclay.
The electronic format forces users to pinpoint application types faster, he says. Whereas paper catalogs may group products in a four-year period, the electronic system immediately separates them by year, making look-ups very specific.
Thus far, the company has had little if any problems with inaccurate information inputted into the catalogs. Maclay attributes this to the relatively few options associated with the company’s products and points out the chance for such errors is greater for more complex offerings, such as engine and driveline components. The only problem Siemens VDO has experienced, he notes, is a slight lag from the time the company makes changes to when they are posted and communicated to users.
Maclay acknowledges that differences in program group, WD and installer practices impact the effectiveness of electronic systems. Although progress has been made in recent years via the Automotive Aftermarket Industry Association’s (AAIA) push toward standardization of how information is presented, he says this has to be embraced throughout the distribution chain to realize the full potential of the system.
Data is key
The key is to make sure everyone has correct and true data, agrees Jim Eady, the Automotive Warehouse Distributors Association (AWDA) president. But he believes there still are too many inputting errors and incompatible legacy systems in the market.
“We need everyone on the same format and have to educate installers better. And we have to make greater use of data warehousing to reduce excess inventory,” he says, lamenting that WD return rates are far too high. Cleaning up the process so that the right part is ordered the first time will go a long way to reduce alleged warranty claims that are really parts that should have never been ordered, he reasons.
AWDA’s merger with AAIA should help the process. Although the main benefit of combining forces is expected to stem from increased clout on Capitol Hill, it also promises to put manufacturers and distributors on the same page in other areas. “In a program group, there is trust between members,” Eady says. The theory is that joining with AAIA will extend this relationship to manufacturers so that everyone feels like they’re on the same team.
When it comes to the quality of parts, Eady has nothing but praise for manufacturers. He also believes that intentional false claims by installers and WDs are on the decline. Not everyone agrees with this assessment, however, and some jobbers even go as far as to characterize their most disreputable customers as being in the warranty claims business instead of the repair business.
