Today’s Market The independents are aggressively pursuing the dealership maintenance and repair business. Previous New Car Dealers are now Used Car Dealers.
Today’s Market They now provide additional services and conveniences to attract your customers.
Today’s Market When independents ‘conquest’ dealership maintenance business it reduces our customer count in the service department.
Today’s Market It weakens our relationship with the customer.
Today’s Market When customers get used to going elsewhere for regular maintenance it becomes easier for them to ‘stray away’ from the dealership for their repair business.
Market Impact Appointment lead times are down from 7-10days to 1-3 days.
Market Impact Hours per work order are down from 2.4 hours to 1.6 hours.
In Real Terms To sell 70 hours per day, instead of requiring 29 customers, you now require 44 customers.
In Real Terms That’s a52% increase in customers to sell the same hours.
Reality Check Your FIXED Operation is no longer fixed!
Improved quality Extended service intervals Short term leases Engine oil life indicators Lifetime transmission fluids Five year coolants Reduced operation times Lower warranty dollars Less repair business Reality Check
Reality Check Work Order Count Hours Per Repair Order Effective Door Rates Parts to Labor Ratios Warranty Work
Reality Check Your VARIABLE Service Department.
Reality Check To prevent the erosion of your Service Department we must maintain a relationship with the customer after the manufacturer’s warranty expires.
The Opportunity Selling more Extended Warranties is the single best strategy to keep the independents from ‘conquesting’ your maintenance and repair business.
The Opportunity If your Extended Warranty penetration is 30%, then the other 70% of your customers are probably doing business with the independents.
The Opportunity Increase your Manufacturer’s Extended Warranty penetration. Maintain and grow your maintenance and repair business.
FACT • Customer retention drops to 24% after basic warranty has expired. This increases to 74% when the customer has a Manufacturers’ Extended Warranty
The Manufacturers’ X-tended Warranty Refund Program is ‘product enhancement’ that is designed to help sell more manufacturer’s extended warranties in your dealership and offer an outstanding ‘value proposition’ for your customers.
The Manufacturers’ X-tended Warranty Refund Program provides a full refund (to a maximum amount of $4,000) of a manufacturer’s new vehicle extended warranty should the vehicle owner/lessee not experience any mechanical breakdown claims during the term of the extended warranty plan sold. A 25%+ INCREASE IN EXTENDED WARRANTY PENETRATION !
The manufacturer’s new vehicle extended warranty sold must be a minimum of 60 months and exceed any manufacturer’s “bumper to bumper” coverage by at least 24 months in order for the Manufacturers’ X-tended Warranty Refund Program to apply.
Simply add the price of the Manufacturers’ X-tended Warranty Refund Program to the price of the manufacturer’s new vehicle extended warranty. Once the manufacturer’s new vehicle extended warranty has gone to term without mechanical breakdown claims, the vehicle owner/lessee submits a request for a warranty refund.
The REFUND includes: the purchase price of the Manufacturers’ New Vehicle Extended Warranty PLUS the price of the Manufacturers’ X-tended Warranty Refund Program PLUS applicable provincial and federal taxes.
Marketed by: • Co-Auto • V.A.G. Quebec • MDA Services of Alberta • Select Independent Agents • Administered by: • RMA • Underwritten by: • Trisura Guarantee • Insurance Company • Training by: • Wye Management
The Benefits INCREASED EXTENDED WARRANTY PENETRATION… IMMEDIATELY! INCREASED SERVICE DEPARTMENT CUSTOMER RETENTION and PROFITABILTY. INCREASED SALES DEPARTMENT RETENTION. INCREASEDEASED F&I PROFITS… NOW! IMPROVED CUSTOMER SATISFACTION! AN OUTSTANDING VALUE FOR YOUR CUSTOMERS!
Success Strategies • GET ENTHUSIASTIC !!! • ADVERTISE THE Manufacturers’ X-tended • Warranty Refund Program WITHIN THE • DEALERSHIP. • UTILIZE THE PROVIDED BROCHURES • AND POINT- OF-SALE MATERIALS. • EDUCATE THE SALESPEOPLE.
Success Strategies • UTILIZE THE PROVIDED POWERPOINT • PRESENTATIONS. • PRESENT THE Manufacturers’ X-tended Warranty • Refund Program TO EVERY CUSTOMER. • SET HIGH GOALS FOR EXTENDED • WARRANTY PENETRATION !
FAQ Q - Do scheduled oil changes affect the Refund? A - No, additional benefits, such as oil changes and tire rotations, and benefits such as custom trip routing will not void the Warranty Refund Q - Does using the roadside assistance plan or having a vehicle towed void eligibility for a refund? A - If the claim for such items as roadside and towing are covered under the basic vehicle comprehensive warranty at the time of claim, it will NOT void eligibility. Any claim that is processed under the Manufacturers’ Extended Vehicle Warranty/Service Contract will void eligibility for a refund.
FAQ Q - I’m concerned that a customer might go to an independent service facility to pay ‘cash’ for a repair near the end of their extended warranty period rather than having it repaired utilizing their extended warranty at my dealership (in order to get their Refund). Is this likely? • A - No. Let’s say for example, your customers’ vehicle is nearing the end of its extended warranty/service contract and is towed in for a no-start. The problem is diagnosed as being the starter solenoid with a retail replacement cost of $120 parts & labour. When the customer is contacted for authorization to complete the repair, as they must be whether it is through warranty or retail, they may choose to pay the $120 retail with the knowledge that they have a full refund coming to them in the very near future. • The customer is not going to ask for the vehicle to be towed to an independent shop. This presents a win-win situation as the customer has the security of an extended warranty/service contract and full refund while only paying for a single retail repair. The win for the Dealership is that they have a very happy and long-term customer who is going to receive a refund cheque for their extended warranty/service contract.
FAQ Q - How long is a vehicle eligible for Xwrp? A - As long as the term of the Xwrp and warranty is a minimum of 60 months from the date of sale of the Xwrp and exceeds the basic vehicle comprehensive warranty by a minimum of 24 months, the vehicle is eligible. Q - Is the Xwrp transferable? A - The Xwrp cannot be transferred or cancelled.
FAQ Q - What does a person with an Xwrp need to present to prove no claims were made? A - Proof of no claims is a simple matter of the Service Department checking the VIN history and when eligible, making note on company letterhead. This letter along with a copy of the Xwrp, the Manufacturers' Extended Warranty Contract, current vehicle registration and proof of insurance is submitted to the Claims Department and the Refund Cheque gets mailed to the Dealer made payable to the customer.
FAQ Q - Who insures that in the event of a claim the money for the refund claim will be there when the customer meets all the qualifying conditions? A - This product is fully underwritten by Trisura Guarantee Insurance Company - trisura.com Q - Is the Xwrp available for RVs, Motorcycles, etc.? A - No, At the current time the program covers only new and nearly new auto vehicles.
FAQ Q - What if a customer's warranty is 60 months/100,000km and the customer purchases the Xwrp, but exceeds their 100,000km in the 4th year. When is the customer eligible to request a Warranty Refund? A - After the 60 months has expired. The Refund request must be submitted to and received by the Administrator within sixty (60) days subsequent to the Warranty Contract expiration by time (Full Term). “Full Term” means the number of months of the Warranty Contract, starting from the Effective Date and concluding no earlier than 60 months from the Effective Date.
Additional Info: Of note is that while the refund is made payable to the customer, it is in fact mailed directly to the Dealership for distribution. This facilitates using the cheque as a down-payment on a new vehicle if the customer so chooses. • The real hurdle in selling Manufacturers’ Extended Warranties/Service Contracts is double edged. With vehicle quality ever increasing, making it more challenging to sell warranties/service contracts, new vehicles are becoming more complexity resulting in the cost of warranty/service contracts increasing significantly. • How to sell an Xwrp? Simply offer the warranty with or without a full refund. Show the warranty separately from the XWRP and let the customer decide. It’s in the customers’ and the Dealers’ best interest. A genuine WIN – WIN. • Please note that Xwrp does not approve of bundling or adjuncts.
“People who want milk should not seat themselves in the middle of a field and hope the cow will back up.” Elbert Hubbard