Warranty Week Newsletter Archives

Some manufacturers defy categorization into an industry group, but still issue product warranties for their goods. "Other" products sold with limited warranties attached include vapes and e-cigarettes, exercise equipment, jewelry, watches, golf clubs, firefighting equipment, surveillance cameras, police body cameras, water management infrastructure, oil and gas pipelines, and hazardous site investigation robots.

The warranty expenses of the U.S.-based telecommunications equipment industry have decreased significantly over the last two decades, especially in the landline and mobile phone industry sub-group. In addition, the average warranty claims and accrual rates for the industry have decreased by about one-third since 2018.

The list of U.S.-based electronics manufacturers that report their warranty expenses does not include several heavy hitters in the industry. Since Apple ceased publishing its warranty data in 2022, we've seen reported warranty costs in the computer industry drop in half, but expenses in the semiconductor industry have been on the rise.

The warranty expenses of the HVAC industry exceeds those of the appliance industry, but the appliance industry had much higher average warranty expense rates than the HVAC manufacturers do. So the HVAC manufacturers are spending more on warranty overall, but the appliance manufacturers are spending a larger proportion of their product sales revenue on warranty.

Total warranty claims exceeded total warranty accruals in the U.S. aerospace industry, and for the three largest manufacturers by warranty costs, Boeing, RTX, and GE Aerospace. The industry average claims rate also exceeded the average accrual rate in 2024.

This paper by VectorSolv CEO Aleem Lakhani presents an assessment of the impact of tariffs on the United States home appliance market. The findings reveal that while tariffs may yield short-term benefits to certain domestic producers, they tend to result in higher prices, reduced consumer welfare, and distortions in global supply chains. Furthermore, the repercussions of tariffs extend to aftermarket services and warranty providers, resulting in increased repair costs, logistical bottlenecks, and a shift in perceptions of product value.

The industry set a new record high for total warranty claims paid in 2024, for the second year in a row, while total accruals made and reserves held both decreased from 2023. Paccar saw claims costs rise by 45%, a year after it nearly doubled its warranty accruals.

The new home builders saw a bit of respite from rising warranty costs in 2024. Total warranty accruals in the industry increased by less than 1%, total claims paid decreased by -2%, and reserve end-balances increased by just 4%, showing some stability after years of skyrocketing construction, repair, and warranty costs.