Wednesday, June 29, 2022

Should You Consider an Aftermarket Warranty for Your Fleet?

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Kieran Mcleod
Kieran Mcleod
Kieran Mcleod was born and raised in Cleveland. As a journalist, Kieran has contributed to many online publications including The Street and The Inquir. In regards to academics, Kieran earned a degree in business and law from St. John's University. Kieran covers business and stories related to law here at Business News Ledger.

Fleet managers must consider the life cycle of the rigs that power their business. And yet, there are many factors to consider. Probably one of the least understood factors is the type of truck you buy and the aftermarket warranty you must consider for it. It may very well be that if you purchase used commercial motor vehicles, you may need to consider an aftermarket warranty for them. In short, they may help you extend the life cycle of your CMV.

Does Your Trucking Company Need an Aftermarket Warranty?

Aftermarket warranties help resolve challenges related to keeping your fleet in good working order. Even more they’re designed to cover the kind of game-changing repairs that can bankrupt a commercial truck owner, especially small trucking operations.

With a warranty, you know exactly what’s covered and what’s not, making it easy to determine and maintain a budget for preventative maintenance and any deductibles that may apply to covered repairs. In addition, you can pay the full price of the warranty upfront or choose to make fixed affordable monthly payments. This way, if and when a breakdown does occur, you’re not left scrambling for cash or disrupting business cash flow to ensure your vehicle gets repaired.

Whether you purchase or own new or used equipment, you may want to consider an aftermarket warranty solution. Why? Because a comprehensive aftermarket warranty makes good business sense by reducing your out-of-pocket costs for expensive repairs. It also extends the lifecycle of your equipment and enables you to invest business capital where you need it most as you grow your business.

Are OEM Warranties Good Enough?

While OEM warranties do provide some adequate coverage, there may be problems with them in the long run. Let’s look at some reasons why OEM warranties may not be what your trucking company needs:

  • They provide the bare minimum for warranties, everything goes wrong right at the cutoff date, and they have no flexibility in helping you.
  • Costs continue to rise for automotive parts and services.
  • May not last the full length of the lease.
  • There may be constraints on mileage.
  • Too many limitations with commercial vehicles.
  • Too short term; (miles & months) coverage does not include enough critical wear and tear on items for a commercial vehicle.
  • Coverage is understandably limited to defects and exceptions can be problematic.

OEM warranties can generally be counted on for small defects or obvious manufacturer problems, but when it comes to major issues, many trucking companies find themselves unable to get the help they need from their vehicle manufacturer.

Does Your Trucking Company Purchase Used Vehicles?

Buying a used truck is a good idea for many owner-operators and small fleet managers. It frees up cash flow and lowers liability. Why? Because the purchase of a new truck can tie up a considerable amount of working capital, even though it depreciates considerably the minute you drive it off the lot. It’s the same principle we see with passenger cars. But in the end what it really comes down to is affordability.

For many small trucking companies, used trucks are simply a more affordable option. Yet, there’s a greater risk that a used vehicle will require repairs or experience a breakdown sooner than later, despite regular maintenance. To plan for these inevitable repairs, fleet managers generally have two choices.

  1. They can set money aside each month in an account earmarked for repairs
  2. Purchase a comprehensive aftermarket warranty to manage their overall risk

This may seem like an easy choice, but there are certainly other considerations trucking companies must consider.

Trucking Companies Require Working Vehicles

When your entire business is riding on the safety and performance of your heavy-duty truck, protecting your investment should be a top priority. That’s why performing regular maintenance is a critical first step for avoiding unplanned downtime and extending the life of your truck or fleet. Regular maintenance is critical to extending the longevity of the engine, after treatment, and transmission.

Here is a comprehensive list of items you need to pay close attention to if you want to ensure your trucks stay in good working order. After all, you do not want to have to call on your warranty. It is there to protect you.

  • Check your fluids (ensure proper oil, coolant, and antifreeze levels) for leakage and proper amounts before each trip.
  • Ensure your electrical system is working properly and that no wires are worn or loose.
  • Check malfunction indicator lights for proper operation.
  • Check brakes to ensure there are no leaks in the air pressure system and that your warning alarm is working properly.
  • Maintain service records.
  • Semi-Annually change oil and filter.
  • Do NOT overfill the oil or “top it off” as this can cause serious engine problems.
  • Annually replace transmission and differential fluids.
  • Establish a routine air filter maintenance program (prevents loss of after-treatment system performance).
  • Ensure you and/or your driver understands each warning light and what action is necessary to take Semi-Annual or every 200,000 miles.
  • Aftertreatment system inspections to avoid complications.
  • Remove and clean your DPF annually to remove accumulated noncombustible ash from the filter.

If you do not take proper care of your truck and equipment, you may find yourself with all sorts of problems, including:

  • Increased downtime.
  • Expensive repairs and replacement parts.
  • Voided OEM/Aftermarket warranty.
  • Engine malfunction or breakdown.
  • Aftertreatment performance slows down.
  • Loss of horsepower.
  • Transmission and after-treatment breakdowns.

Do Trucking Companies Really Need Outside Warranties?

Like any business operator, semi-truck owners need to make sure they’re protecting their most important investment. In the end, commercial truck warranties are one of the most important investments you can make for your fleet. When there’s an emergency, downtime and repairs can sink your trucking operation. That’s why warranties are a must for truck owners.

When you purchase a new Ford, Mack, Volvo, or other big rigs, you have a few options available for warranties. An OEM warranty is offered by the brand, and trucking centers will generally uphold those warranties. Typically, standard OEM warranties will cover most major repairs for the first 24 months or 250,000 miles driven. For example, Volvo’s warranty covers the replacement or the repair of failed components if they were properly maintained. That is a key provision. Who decides whether you properly maintained that truck or not?

You can also find after-market warranties from dealerships that work a lot like insurance. They aren’t offered by the OEM and are instead brokered by a middleman. There are different types of aftermarket warranties that cover different issues. Usually, they’re offered on any truck that meets the broker’s maintenance requirements. Purchasing an aftermarket warranty comes at an additional cost. However, it could make sure you are not stuck with high repair costs down the line.

What Should You Look for in a Warranty Provider?

The exceptional quality of your workforce provides you with a valuable competitive edge. To build on this advantage trucking companies must strive to hire and retain the most qualified people and maximize their opportunities for success through training and development. Fleets must remain committed to maintaining a safe and fair work environment enriched by diversity and characterized by open communication, trust, and fair treatment.

As a fleet manager, when it comes to a warranty claim, are you dedicated to shortening the time to action at every step in the claims process? You need an experienced team that is available around the clock to help meet your used truck warranty needs. When you look for an outside warranty provider, look for one that has excellent customer service and fast response times. Can they expedite the process and facilitate repairs so you can get your commercial vehicle back on the road as quickly as possible?

Trucking companies need to maintain flexibility to adapt to changing conditions, the nature of your business requires a focused, long-term approach. Will your partner consistently strive to improve efficiency and productivity through learning, sharing, and evaluating best-demonstrated practices? They must seek and develop proprietary technologies, products, programs, and services that provide their clients with a clear competitive edge.

Few machines will see as much use as a heavy-duty truck, meaning that maintenance and servicing can be tough on the wallet. But an unexpected engine failure can cost you upwards of $20,000. By taking advantage of commercial truck warranties for both new and used heavy-duty trucks, you can prevent those losses.

 

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