Archived Copies of Warranty Week

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December 2002 to Today

Truck & Heavy Equipment Warranties: As the lockdowns grew, some manufacturers reduced their warranty accruals drastically in the spring of 2020, but claims remained about the same anyhow. Some got it right, but most reduced their accruals by too much, while a few cut accruals even though sales rose.

February 25, 2021

Telecom Equipment Warranty Report: Warranty claims, accruals and reserves rose a bit from record low levels in 2018, but the long-term decline in the telecom network hardware industry continues unabated. Several mergers contributed to the recent increases, while some of the largest industry players continue to increase reliability, cut costs, and drive down their warranty expense rates.

French Automaker Warranty Expenses: Renault has always kept its warranty expenses low, but three years ago PSA suddenly cut its costs by more than two-thirds. Now they're creeping up again as the makers of Peugeot and Citroen works to integrate the acquisitions of Opel and Vauxhall it made from GM.

Medical & Scientific Equipment Warranty Report: Though the systems that use lasers or radiation always seem to have higher warranty costs, most of the medical device and scientific instrument manufacturers have cut their costs considerably over the past 16 years.

Automotive OEM Warranty Report: The car manufacturers used to spend a greater share of their sales revenue on warranty work than the truck manufacturers did. But because of persistent cost-cutting, that is no longer the case. Last year, car manufacturers cut their expense rates to below-average levels, while the truck manufacturers were slightly above their long-term average at the end of 2017.

Fifteenth Annual Product Warranty Report: All the metrics are down this year, including product sales. Some companies continue to cut their warranty expenses by huge amounts, producing better products with lower failure rates. But others are getting better at shifting more of their warranty expenses back onto their suppliers.

Midyear Computer Industry Warranty Report: Even though numerous industry players have been acquired or have gone private, the remaining manufacturers have continuously cut their warranty expenses from one year to the next. But then along came the iPhone, and now Apple's frequent ups and downs are dominating the industry's statistics.

November 2, 2017

Semiconductor Warranty Report: Though the companies making capital equipment that's used to fabricate and test semiconductors and printed circuit boards continue to pay more warranty expense than their manufacturing customers, the gap has narrowed considerably over time. Some companies have cut their expense rates in half.

Aerospace Warranty Expense Report: Because one major airframe manufacturer has now separated its warranty and extended warranty accounts, the aerospace industry totals and averages are in disarray. However, many OEMs and suppliers continue to cut their warranty costs, setting new record lows for their expense rates.

U.S. Truck & Auto OEM Warranty Report: While falling sales drive Navistar's claims rate upwards, Paccar finds ways to cut warranty costs. And both GM and Ford continue to report some of the lowest warranty cost per vehicle metrics in the world, while Tesla gets its warranty costs under control.

Appliance & HVAC Warranty Report: HVAC manufacturers have lower warranty costs but are more cautious than other kinds of appliance makers, keeping a much higher ratio between claims and reserves. But neither group has done much to reduce their warranty expenses, though some companies have cut their costs by hundreds of millions of dollars.

Medical & Scientific Equipment Warranty Report: Though product sales are down, warranty expenses are down by more. And while any equipment that uses lasers or X-rays has higher warranty expenses than units that don't, those manufacturers have cut their warranty costs significantly in the past decade.

European Auto Warranty Report: In this initial piece of a two-part series, we look at the claims rates and accruals-per-vehicle rates of five of the top European automotive OEMs. Whether we count in euro or dollars, some of them have the most expensive factory warranties in the world. But a few have managed to cut those costs over the past decade.

Aerospace Warranty Report: Because a few big manufacturers dominate the industry, their problems or successes with warranty cost control can change the industry averages significantly. But over the long term, the trend is clear: aerospace suppliers have learned how to cut their warranty expenses and keep them low. The OEMs? Not so much.

Top International Warranty Expense Reductions: While HP saved itself a billion dollars a year, two German carmakers have saved themselves twice as much. Three others have cut their annual claims payments by hundreds of millions of dollars a year in the past decade.

January 22, 2015

Top Warranty Expense Reductions: Using a list of just the top 200 warranty providers, we found one company whose warranty managers have cut costs by a billion a year within a decade, two more that cut hundreds of millions a year, and five that cut tens of millions a year from their employers' annual claims cost. And there were 16 more that deserved honorable mentions for their efforts.

January 15, 2015

Warranty Year in Review: While some companies enjoyed record highs on the stock market, others suffered as rising warranty costs cut into profits. Some even went out of business. And top automakers once and for all proved how useless the TREAD Act is when it comes to protecting customers.

January 8, 2015

Homebuilder & Supplier Warranties: Unlike in the automotive industry, where the OEMs have compelled their suppliers to pay a larger share of warranty costs, the homebuilders are reducing their share by selling fewer new houses. It's the building material suppliers who have learned how to cut warranty costs by reducing their expense rates.

September 11, 2014

Warranty Accruals per Vehicle: Though currency fluctuations are a major factor, in 2013 both GM and Ford accrued less per vehicle sold than any of the European or Japanese OEMs. And though BMW and Daimler command a higher price per vehicle, they've accrued less and less per unit over the past decade as they continue to cut warranty costs.

Medical & Scientific Equipment Warranties: While most of the companies in this industry have relatively low warranty expenses, those whose equipment involves either X-rays or lasers spend a much higher percentage of revenue on claims. Yet those are the companies that have done the most to cut their warranty costs over the past decade.

The End of Warranty Cost-Cutting? For ten straight years, manufacturers steadily reduced their warranty expense rates from over 1.8% of their sales revenue to under 1.3%. But in the eleventh year, the declines stopped coming. Could it be that there's no more left to cut? And have manufacturers instead begun to spend more on the customer experience?

New Approaches to Warranty Management: For many years it was all about cost reduction. Now, there's little left to cut. And both manufacturers and retailers are looking for ways to improve the customer experience by launching new types of protection services and new generations of warranty automation systems.

Most Improved Warranty Metrics, Part 2: Warranty expense rates have been on a downward trend for most of the past decade. And most of the manufacturers are reducing their claims and accrual rates year after year. Some, however, continue to cut costs faster than their peers.

October 25, 2012

Semiconductor Warranties: The companies that make the equipment that makes the semiconductors pay for more than half of the industry's warranty costs, even though their sales are less than a quarter of the total. But they've also done the most to cut their costs since 2003.

Aerospace Warranties: The makers of Boeings, Cessnas and Gulfstreams haven't made much improvement in the past five years. But their suppliers continue to boost revenue, cut costs, and reduce warranty expenses as a percentage of sales. And that divergence got worse as 2011 ended.

New Home & RV Warranties: When sales were falling, builders cut their warranty accruals. But, worried by claims payments that didn't fall as fast, they didn't cut accruals enough. So now some have built up excess levels of warranty reserves that may be in the multiple millions of dollars for at least 10 homebuilders.

January 5, 2012

Design for Warranty: Products can be designed so that not only can they be fixed faster, but also so they can be fixed by customers themselves. Given that labor is the major component of warranty claims, product designs that plan for customer self-repairs can cut costs.

Warranty Cost Cutting: Among the top 100 warranty providers, more than half have reduced the percentage of sales they allocate to warranty costs in the past year. Some have cut their accrual rates by a third, a half, or even more. And many have also seen their claims rates fall, suggesting not only cost cutting but also quality improvements.

November 20, 2008

Warranty Software: SigmaQuest debuts a new root cause analysis module that helps manufacturers reduce the scope of product recalls and cut warranty costs. It's also priced by the month and uses a Web interface to reduce the cost, time and effort needed to begin using it.

November 6, 2008

Medical Equipment Warranties: While claims are increasing, sales are rising a little faster in the medical and scientific equipment industries. And at least eight companies have cut their warranty expenses by big percentages over the past five years.

October 2, 2008

RV & New Home Warranties: Sales are declining so claims rates are rising. But a few homebuilders have radically cut the amount they set aside per unit sold, raising suspicions that they're intentionally estimating low. Meanwhile, homes on wheels continue to show higher warranty costs.

WCM Workshops, Part Two: The day before the opening of the Warranty Chain Management Conference next month, attendees have a chance to hear experts talk about how to reduce warranty-related litigation and how to cut down on the amount of warranty fraud.

February 21, 2008

Computer & Peripheral Warranties: At midyear, it looks like many of the major brand names continue to cut their warranty expenses, as do many of their suppliers. But soon Dell will restate its warranty accruals and that could erase the declines completely. Or will it add to them?

September 18, 2007

Warranty Spending in 2006: With the total over $28 billion and climbing, warranty claims reported last year by US-based manufacturers have never been higher. But while some companies pay out more of their sales in warranty claims, others have cut some key ratios significantly.

Top 100 Warranty Providers: In this midyear report, we look at who's up and who's down compared to a year ago. Driven by acquisitions and longer warranties, some companies are paying out more than ever before. But others have found ways to cut their outlays by big numbers.

September 26, 2006

Early Warning Standards: Decades ago the AIAG helped set standards for electronic commerce when it developed new data interchange standards. Now it's doing similar work with warranty data communications standards, looking for ways to reduce delays, improve accuracy, and cut warranty claims costs.

Product Warranty Trends: 2005 is shaping up to be a $27 billion year for the warranty industry, though claims still represent only 1.7% of sales. More than a dozen companies have cut their claims rates. Some manufacturers, however, have seen their claims rates soar into the danger zone.

January 10, 2006

Ford's Warranty Reserves: Standard & Poor's cut Ford Motor Company's credit rating from BBB to BBB-, citing write-offs at Ford Europe, reduced warranty accruals, and lowered reserves for bad loans by Ford Credit. But were those reduced warranty accruals justified by reduced claims costs?

November 17, 2003

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