Archived Copies of Warranty Week

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December 2002 to Today

HVAC & Appliance Warranty Report: The appliance makers have higher warranty expense rates but the HVAC makers spend more. They also maintain warranty reserves that are much larger than the appliance companies, because the warranties on their products have longer durations.

Semiconductor Warranty Report: In this industry, the makers of the factory machinery that fabricates and tests the actual products seem to have much higher warranty expense rates than their customers. But they also have reduced their expense rates significantly over the past 15 years, while the expense rates of the device makers have remained more or less the same.

Aerospace Warranty Report: Unlike the automotive industry, the manufacturers of commercial airplanes do not have higher warranty expenses than their suppliers, and do not spend a larger percentage of their sales revenue on warranty claims. But just like those land-based vehicle makers, airplane and helicopter manufacturers have been cutting their warranty costs for more than a decade.

The 80/20 Rule of Product Warranties: Almost 80% of all the warranty claims and accruals reported by U.S.-based companies come from only 20 companies. Upwards of 500 other manufacturers account for only 20% of the total. But the expenses of the largest warranty providers are also a higher share of their sales revenue.

November 16, 2017

Automotive Supplier Recoveries: A decade ago, the largest OEMs devised new warranty policies that helped to shift more of their expenses back to their suppliers. But then in 2014, an increasing number of safety recalls raised their warranty cost back up, leaving both them and their suppliers at higher expense levels.

Medical & Scientific Equipment Warranty Report: Anything involving lasers or X-rays seems to have higher warranty costs than other types of medical devices and scientific equipment. But the gap between them has been narrowing for years, and may soon disappear. Meanwhile, several major medical companies don't think that warranty expenses are worth the effort to report, despite rules saying otherwise.

Electronics Warranty Report: Although not as pronounced as in the automotive industry, and not as unseen as in the aerospace industry, there is definitely a gap in the high-tech sector between the warranty expense rates of OEMs and their suppliers. Makers of computers, telecom equipment, and medical devices have much higher warranty costs than disk drive or semiconductor manufacturers.

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.

Semiconductor & PC Board Warranty Report: For most of the companies making microchips and printed circuit boards, sales are up and warranty expenses are down. But expenses have fallen far more dramatically for the suppliers of the chip manufacturing equipment, who used to spend a far higher share of their revenue on claims than their customers did.

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.

Computer Industry Warranty Report: Though their warranties are usually shorter than those on cars and trucks, their expense rates are almost as high, as a percent of revenue. And despite their higher-than-average claims and accrual rates, many computer, disk drive, and printer manufacturers prefer to keep their warranty reserve cushions as slender as possible.

Auto Parts Supplier Warranty Report: Suppliers of engines and transmissions keep larger warranty reserve balances and pay higher warranty expense rates than do suppliers of other automotive components. But those other suppliers have done a better job of cutting their warranty expenses over the past decade, though they've lost ground recently.

HP's Warranty Accounting: Before the split, HP's warranty expenses were declining for multiple years. After the split, the laptop and printer company has much higher warranty expenses than the server and storage company.

February 18, 2016

Warranty Lawyers: Better to let them do their jobs before the launch than to bring them in for the clean-up after you make a mess. As protection programs become more complex and laws become more complicated, the need for warranty law expertise has never been higher.

September 24, 2015

International Aircraft Warranties: The bigger the plane, the higher the price, and the lower the warranty expense rate as a percentage of that average selling price. The products of the top seven aircraft manufacturers in the world can basically be ranked in size order, with the largest paying under 0.4% on warranties and the smallest paying 4% or more on warranties.

Honda's Warranty Expenses: Every major automaker gets their turn to suffer from massive recalls once in a while. So now it's Honda's turn. But is it possible that thanks to the apparently high cost of fixing airbag defects, Honda now has higher warranty costs per vehicle than GM?

New Home & RV Warranty Report: Put a home on wheels and its warranty costs rise. While the warranties on traditional site-built homes typically cost the builder about one percent of selling price, the warranty cost of mobile homes is somewhat higher. And the warranty cost of modular, prefabricated homes may be highest of all.

Medical Equipment Warranty Report: While most of the companies in this industry have fairly low warranty expense rates, those that deal with either lasers or X-rays see much higher costs. And even those with low costs keep a very thin cushion, so when things go wrong they go very wrong.

Data Storage Warranty Expenses: While the traditional hard drive makers have more predictable and stable warranty costs, the newer solid state and flash memory systems seem to have lower costs. However, their price per gigabyte of capacity is much higher.

December 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.

Appliance & HVAC Warranty Report: While we group them together, they're actually very different. Appliance makers pay higher warranty expense rates but for shorter durations. HVAC makers keep larger reserves on hand but they have to, given their longer-lasting warranties.

Smartphone Warranties: As with luxury cars, we're finding that the smarter the phone and the more advanced its features, the higher the warranty costs. And some of the smartest phones with the biggest market shares are now driving up the warranty costs of their manufacturers.

Medical & Scientific Equipment Warranties: Most of the manufacturers in this industry have low warranty expense rates, except for those whose products use lasers or X-rays. But while their expenses are higher, they've also done the most to reduce warranty costs over the past decade.

Tenth Annual Warranty Report,
Totals & Averages: The automotive manufacturers are cutting their warranty expenses while the computer makers are seeing higher costs. But put them together, and they're paying the smallest percentage of their revenue ever for warranty work on their products.

Medical & Scientific Equipment Warranties: Though warranty costs have remained within a tight range for eight years, there's a definite seasonal pattern to the data that's tied into the school calendar. And though these equipment makers typically spend a small percentage of sales on warranty costs, some products have much higher averages.

December 16, 2010

Automotive Supplier Warranties: While costs are down, so are sales. And while many suppliers are reporting higher sales in 2010, the proportion between their warranty costs and sales is higher than ever. And that's the unfortunate result of an increased effort by vehicle makers to push more of their warranty costs back onto their suppliers.

December 2, 2010

Computer Warranties: At the half-year mark, HP is up and Dell is down, while Apple and Seagate keep their warranty costs under control. At Lexmark and Palm, however, already-elevated warranty costs keep going higher.

September 18, 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.

Green Warranties: As the price of traditional fuels soar, the alternatives are becoming more viable. And manufacturers are promoting the growing viability of electric and biofuel-powered vehicles through longer warranties. Government is also getting involved by mandating higher fuel efficiency, new fuel blends, lowered emissions levels, and longer warranties.

New Home Warranties: Pre-fab and mobile homes have much higher warranty costs than site-built homes. But even for site-built homes, there are big differences between the builders in the way they save and spend their warranty funds.

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.

Peripheral Warranties: With computer printers and monitors, older technologies frequently get longer warranties than new. And while one would think higher prices mean longer warranties, that doesn't seem to be the case.

Automotive Warranties: Ford and GM are not only the largest providers of automotive warranty. They're also paying a higher percentage of their revenue in claims than everyone but the makers of RVs and rider mowers.

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