Warranty wars benefit car buyers

In a competitive auto market where anything goes -- including zero-percent financing -- more automakers are turning to longer, more comprehensive warranties to woo customers.

More than a dozen automakers now offer basic warranties well beyond the once-standard three years or 36,000 miles protection. They include Hyundai, Kia, Audi, Acura, BMW, Cadillac, Volvo, Saab, Mercedes, Lincoln, Lexus, Jaguar and Infiniti.

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And several automakers offer super-long powertrain warranties, which cover potentially costly repairs to a car's engine and transmission.

"You're talking about $2,000 for the average repair and it could be a lot higher," says Joe Grant, president of J&L Warranty Pros.

The splash heard 'round the industry
Hyundai made a big splash back in 1999 when it launched a 10-year or 100,000 miles powertrain warranty on top of a five-year, bumper-to-bumper warranty.

"They didn't have any market share," Grant says. "They had to do something to grab attention."

Did it work?

"Oh yeah, they've picked up market share. They've kicked butt with it," Grant says.

Other manufacturers took notice. If an amped-up warranty could work for Hyundai, it could work for them as well.

"When one company starts it there's going to be warranty wars," Grant says.

Kia followed Hyundai's lead, offering identical warranty protections in 2000. Several other automakers have followed suit. Toyota, Mitsubishi, Nissan, Infiniti, Lexus, Daimler Chrysler and Isuzu all offer powertrain warranty protections above and beyond the factory warranty.

All of this is good news for consumers.

"You're going to see more of them lasting longer," says James Walsh, author of Smart Wheels, Hot Deals: Buying, Leasing and Insuring the Best Car for the Least Money. "This is a good trend."

Perks keep piling
In addition to increased warranty protection, automakers are piling on the perks for new-car customers. Most manufacturers provide new-car customers with 24-hour roadside assistance for the length of a car's factory warranty. Several luxury carmakers toss in trip-planning services as well.

For example, Lincoln customers are entitled to four years of roadside assistance, emergency-travel-expense reimbursement and destination assistance and trip-planning services. Mercedes offers free, unlimited trip-routing services for any Mercedes driver. Just have the vehicle identification number of your Mercedes handy when you phone in your travel request.

Luxury carmakers are also pouring on the perks at the dealer repair shop. Bring a car down to the dealership for a warranty repair or scheduled maintenance and Infiniti and Audi will give you a free loaner vehicle on the spot.

"At Mercedes, they'll come to work and pick up your vehicle and drop it off when it's done -- all for customer service," Grant says. "The customer is king."

Saab, Lincoln, Audi and BMW will even pay for a new-car customer's scheduled maintenance costs. Saab and Lincoln pick up the maintenance tab for three years or 36,000 miles. Audi and BMW treat their customers to free maintenance for four years or 50,000 miles.

BMW's complimentary maintenance program even includes items such as brake pads, brake rotors and wiper blades, which aren't covered under the factory warranty. Other programs may be less generous.

Know what's covered
Before taking up an offer of free maintenance, be sure to track down the details.

"Find out all the specifics," says Eric Anderson, ownership database supervisor at Intellichoice. "Are you covering my tires? Are you covering my brake pads? Ask upfront so you'll know if there are any hidden costs."

You'll want to take the same approach when checking out new car warranties. This roundup of new car warranties and add-on perks by Bankrate.com will help you get started.

The first thing to focus on is the length of the warranty and what repairs are covered.

"The longer the term of the warranty, generally the more limited the warranty is," Walsh says. "A 10-year powertrain warranty is a substantial warranty, but it doesn't cover bumper to bumper."

A new-car limited warranty also known as a factory warranty or bumper-to-bumper warranty gives you the best overall protection. But even this doesn't cover everything. Wear-and-tear items such as brake pads and wiper blades are often excluded.

Be sure to find out what maintenance items and repairs aren't covered under a new-car warranty. And it's important to realize that even a covered repair may not be free.

Daimler Chrysler's powertrain warranty may last for seven years, but you pay a $100 deductible on any repair after three years.

Is that super-long new car warranty transferable? Hyundai's 10 years or 100,000 miles of powertrain protection dips down to five years or 60,000 miles if you sell the car to anyone other than an immediate family member.

If you can transfer a super-long warranty to a new owner, will you be charged a fee? Some automakers charge $50 to $100 transfer fees.

To hang on to a new-car warranty you'll have to play by the rules. Follow your car's recommended maintenance guidelines to the T.

For example, you'll need to get regular oil changes using the specific weight of oil recommended in your owner's manual. And you may need to get those oil changes and other routine maintenance items taken care of at the dealer shop. Be sure to ask.

"There is required maintenance to keep the warranty going," Walsh says. "They'll be prickly too about where you get the maintenance. An oil change at Jiffy Lube may not cut it."