Buying a new car is a sizeable investment and one that calls for a bit of thinking. Aside from the basic assessment, such as the specs of the car and the car accessories that come with your purchase, non-tangible benefits such as a warranty are also crucial. 

Defining Car Warranty

A car warranty is a list of promises that an auto manufacturer makes to the buyer in case issues arise with the vehicle post-purchase. This warranty is usually applicable for a limited period and contains prerequisites before the warranty benefits may be claimed.

It is important to point out, though, that regardless of what a manufacturer or seller’s warranty says, a car buyer is fully protected by the Australian Consumer Law. Under this law, any product sold comes with a guarantee that it is free from defects and will perform as advertised. For more about how the consumer law protects your rights as a car buyer, you may refer to this article. 

While many new car buyers don't pay much attention to the warranty at the time of purchase, there are significant differences in the warrantied benefits between car brands. For this reason, a wise buyer should compare warranties and factor them into the purchase decision. 

As a general rule, car manufacturers offer warranties for 3-5 years, or from 100,000 km to an unlimited number of kilometres. Luxury car brands offer shorter periods in their warranty, although Mercedes-Benz recently increased the period of warranty it offers to customers from 3 to 5 years. Other luxury players in the market seem to be making similar moves. 

Even if a warranty expires, you can depend on the automatic guarantee provided by the ACL to protect your rights. You may also subscribe to an extended car warranty plan with a third-party warranty provider if you wish, but be prepared to pay for its premium. 

Characteristics of a Good Car Warranty

It is essential to know the warranty policy of car manufacturers. According to data from the Lemon Car Report published in 2016, as many as 66% of all new car buyers have reported problems with their vehicles within the first five years of their purchase, and 14% have reported experiencing severe issues. 

To evaluate a car warranty, consider the following:

1) Length - every car manufacturer sets a limit to the warranty it offers on new cars, both in years and in mileage. These limits are set individually for car parts that are covered under warranty. The longer the length of coverage, the better the warranty will be for you. That is the general rule. Usually, powertrains come with a longer warranty coverage compared to other car parts, such as coverage for bumper-to-bumper. 

2) What’s Included - check the list of car parts included in the coverage. Good warranty coverage will include parts that are generally prone to damage. 

3) What’s Excluded - new car warranties also include a list of parts that the automaker will not cover. Prefer a warranty with a comparatively short exclusion list. 

4) Additional Benefits Offered - car manufacturers may include some attractive benefits as part of their warranty coverage such as roadside assistance, reimbursements for rental cars, and coverage for interruptions experienced in trips, free-of-cost oil changes, and others. These are also important to consider while comparing different car warranties. 

The Best New Car Warranties

The warranties being offered by car manufacturers include bumper-to-bumper, powertrain, corrosion, and roadside assistance. 

Bumper-to-Bumper Warranty

As far as the 2018 and 2019 models are concerned, the best bumper-to-bumper warranty is being offered by Volkswagen, with 6-year and 115,000-km (72,000-mile) limits. 

For the 2020 models, VW offers 4-year and 80,000-km (50,000-mile) limits, which is less than the 5-year and 96,000-km (60,000-mile) limits being offered by Hyundai, Kia, Genesis, Mitsubishi, and Jaguar. Infiniti is offering 4 years and 96,000 km (60,000 miles), while Lincoln, Tesla, and Cadillac are offering 4 years and 80,000 km (50,000 miles).

Powertrain Warranty 

Here are four car manufacturers that offer the best powertrain warranties with limits of 10 years and 160,000 km (100,000 miles). These companies include Hyundai, Kia, Genesis, and Mitsubishi. Tesla offers eight years with varying mileage limits depending on the model. Many other companies are offering 6 years and 113,000 km (70,000 miles).

Corrosion Warranty

Tesla has the best corrosion warranty, offering limits of 12 years and unlimited km. The next best offering is by Hyundai, Genesis, and Infinity, all offering limits of 7 years and unlimited km, while Mitsubishi and Volkswagen also offer 7 years limit but cap the mileage at 160,000 km (100,000 miles). Jaguar and Cadillac are both offering 6 years with unlimited km, while Lincoln offers 5 years with unlimited km and Kia offers 5 years with 160,000 km (100,000 miles). 

Roadside Assistance Warranty

In terms of the number of years, Cadillac offers the best roadside assistance warranty with a limit of 6 years and 113,000 km (70,000 miles). However, Hyundai, Genesis, Mitsubishi, Infinity, and Lincoln are offering unlimited km. Lincoln also does not have any limit for the number of years that the warranty remains valid; hence it offers the best roadside assistance warranty in the market.

Conclusion

Volkswagen offers the best bumper-to-bumper warranty and usually covers the most number of car parts. Hyundai, Kia, Genesis, and Mitsubishi, on the other hand, have the best powertrain warranty. Tesla wins with its 12 years and unlimited-km corrosion warranty. As far as roadside assistance goes, Lincoln is your best bet. 

Considering these facts, it is difficult to declare a clear winner who's offering the best new car warranty. Hence, you should base your decision on the warranty type that best suits your needs and driving style. 

Overall basis, though, both Hyundai and Genesis seem to offer the best warranty package, with 5 years and 96,000 km (60,000 miles) in bumper-to-bumper warranty, 10-year and 160,000-km (100,000-mile) powertrain warranty, 7-year and unlimited-km corrosion warranty, and 5-year and unlimited-km roadside assistance warranty. 

For more news and updates on the automotive industry and information on maintaining your car, we invite you to visit www.carpart.com.au. Also, if you’re looking for car parts, you may browse our classifieds or request a part through our auto parts buy-and-sell platform. 

By Muhammad A. Lashari