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After-market Afterthoughts - Linking Cause and Effect on Warranty Claims


If you’ve ever owned a new vehicle, you’ve likely had to navigate the world of warranty claims. Warranty coverage, similar to insurance policies, is limited and includes a list of exclusions. Perhaps spurred on by the state of the economy, automakers appear to be taking a firmer stance when it comes to warranty coverage claims. This is particularly true in instances where after-market components have been installed.

Warranty coverage can be affected if it can be shown that modification of a vehicle or installation of after-market components contributed to the malfunction, even if the after-market components are installed by the dealers. As the cost of maintaining a vehicle in today’s marketplace is rising, it is prudent for vehicle owners to understand the implications of using after-market components and their potential impact on warranty coverage.

The dealer acts as the intermediary between the automaker and the car owner to determine whether an issue with the vehicle is covered under warranty. Mandates are constantly being issued from the automakers to the dealers stating that the use of after-market components will or can void a vehicle owner’s warranty. The statement will or can void a vehicle owner’s warranty is subject to interpretation by the dealership and warranty repair is authorized or denied at the dealer’s discretion. However, automakers are increasingly scrutinizing the use of after-market parts on their vehicles. When a dealership allows warranty coverage on a failed engine, for example, and the automaker finds out that the vehicle was equipped with an after-market engine modification, there is the possibility that the repair of the damage will then be charged back to the dealership.

Charge backs often occur in instances where after-market accessories can clearly be linked to a vehicle’s damage, therefore voiding warranty coverage. For example, a vehicle owner installs an after-market electronic cruise control. Driving down the road, an internal short occurs in the cruise control unit, which in turn causes over-revving of the engine. Still under warranty, the vehicle is taken to the dealership where they discover engine damage, which can be directly linked to the newly installed, after-market cruise control unit. Coverage is denied by the automaker and the vehicle owner is now on the hook for an engine replacement.

Charge backs can also occur in cases where the after-market component has absolutely nothing to do with the actual failure. For example, when a dealer allows warranty coverage on a vehicle’s failed transmission and the automaker then finds out that the vehicle was equipped with tires different from the recommended size, the automaker can demand a charge back. Even though the two aren’t directly related, the possibility that the repair will be charged back to the dealership is very real. This, in turn, can prompt dealerships to prematurely deny warranty coverage for fear of a charge back from the automakers.

While some dealers are inclined to deny warranty coverage prematurely to protect themselves against the possibility of charge backs, installing an after-market part or modifying a vehicle is not, in and of itself, reasonable grounds for a dealer to void warranty coverage. The parties involved must be able to establish that the failure was caused by modifying the vehicle, or by installing accessories not authorized by the automaker. Only a direct link between the after-market installation or modification and the need for repairs should justify denial of warranty coverage. An expert familiar with both vehicle diagnostics and the investigative process of correlating cause and effect in instances of failure or defect, is uniquely positioned to establish this important link.

 


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