GM Rolls Out Optional Extended Warranty
The new extended ‘bumper-to-bumper’ warranty isn’t designed to act like a dealer-offered service contract. Repairs can be completed without filing a claim and there are no deductibles. The option also is included in a vehicle’s overall price.
DETROIT — General Motors rolled out an extended ‘bumper-to-bumper’ warranty designed to match the coverage term of its powertrain warranty. The new warranty is available on new vehicles purchased on or after Oct. 15 for the 2018 or 2019 model year, according to the company.
The upgraded warranty will cover Chevrolet and GMC vehicles for five years or 60,000 miles and Buick and Cadillac vehicles for six years or 70,000 miles. The standard bumper-to-bumper warranties offer three years or 36,000 miles for Chevrolet and GMC and four years or 50,000 miles for Buick and Cadillac.
Pricing would be set by the dealer, although GM has recommended a price range of between $1,000 and $2,000, depending on the model. The warranty also stays with the vehicle, even if there’s a change of ownership — which could increase its residual value, said Rita Kass-Shamoun, a GM spokesperson.
"We believe this could be a selling point from the original vehicle buyer to the second vehicle owner," said Kass-Shamoun. "We believe this will increase the residual value."
The new warranty isn’t like a dealer-offered service contract, as repairs are completed without the need for a claim to be filed. There also are no deductibles. The option also is included in the overall price of the vehicle and could be folded into a loan or lease.
"People who lease typically keep the vehicle for 24-36 months, so most of them are always covered by the base bumper-to-bumper limited warranty," said Ken Mac, director of Chevrolet, Buick, GMC, Cadillac Protection. "But if you buy, analysts say you’ll likely keep your new vehicle for over six years. This true extended warranty can keep the average customers covered for most if not all of the time they own their vehicle."
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