Warranty administration involves the tracking and recovery of all vehicle expenses related to manufacturer recalls and vehicle warranty-covered repairs. Although it can be a time-consuming and complex task, warranty recovery also can be one of the quickest ways to improve a fleet’s operational bottom line.
Because warranty coverage is part of the price paid for a new vehicle as well as for certain parts — whether from the manufacturer or an aftermarket supplier — to ignore warranties and recovery options is throwing money away.
By carefully defining warranty coverage and monitoring warranty matters, fleets should be able to recover a significant amount of these expenses. Many fleets typically rely upon the expertise of the service manager to identify potential claims and, therefore, often miss many claim opportunities. However, a powerful tool to help manage warranties is a good information management system that automates many of the warranty recovery tasks as well as provides real-time coverage analysis and identifies all potential claims.
The biggest challenges fleets face regarding warranty claims are identifying whether a part is eligible for warranty reimbursement, preparing the claim information and tracking the recovery. Without an effective management system, identifying a part that is still under warranty usually requires wading through a lot of paperwork for parts invoices, work orders and claim forms. A shop management system solves these issues and is able to manage all warranty requirements by using an unlimited amount of user-defined warranty schedules for all types of equipment.
Many fleets have found advantages in using a computerized maintenance management system (CMMS) to handle warranty management and administration. These systems help control, optimize and verify maintenance activities.
Computerized electronic records lay the foundation for automated warranty identification and warranty alerts in real time, whereby a fleet can optimize a repair solution. In general, a CMMS allows the user to carefully record all available warranty coverages on each vehicle and also on aftermarket parts.
Once this data set is established and applied, the system should identify all potential claims in real time. For vehicles, the user simply tells the program what warranty the vehicle has, for example: time, miles, etc., and then instructs the program whom it should notify as the expiration date approaches. When the user sets up a part in the inventory file, he or she defines its warranty. Whenever that part is used on a work order, the warranty attaches itself to the equipment that has been repaired.
If the same equipment comes in for repair and that same part is placed on a work order, many systems will warn the user that the particular part number was used on a previous work order and might still be under warranty.
Another big issue that fleets face is not always submitting work and reconciling payments received for repairs made on warrantied vehicles; software programs can help with this as well. A good CMMS should automatically identify all possible claims based upon the established warranty for the vehicle. Once identified, the claim can be reviewed for accuracy and edited if needed. Some systems can even generate a fileable claim from the data provided.
Additionally, a quality system will track and apply claims recovery for each individual vehicle. Reports showing warranty claim history by vehicle and system will assist a fleet in purchasing and specification decisions.
Without a CMMS, the time and resources required to maintain a warranty recovery program can be overwhelming. What’s more, all that has to be accomplished very quickly after the repair is completed, and most fleets do not have dedicated people to track and file warranty claims.
Because of the lag caused by the research time and the possibility that the part has already been scrapped, many shops have come to think that trying to recover the warranty on lower cost parts doesn’t pay off. A CMMS can provide in-system alerts when a part is eligible for warranty, tag the failed parts, save the information for a more convenient time to process the claim, and easily look up previous work orders and supplier invoices for a specific part or job. BI
Officials with Paccar Parts, which operates a network of parts distribution centers that offer after-sales support to Kenworth, Peterbilt and DAF dealerships around the world, offer this advice for shopping for a computerized warranty system:
• Get your people involved before the system is purchased, especially those who are expected to use it.
• Make sure that the system you are considering meets your key performance indicators, quantifiable measurements used to define and gauge performance factors in terms of meeting strategic, business and operational goals.
• Determine whether the system provider offers training and continuing support, and at what cost.
A good computerized warranty system should provide the following, according to TMW Systems, a leading supplier of solutions covering the transportation services sector:
• Ability to compile and track all potential warranty opportunities.
• Provide alerts when a warranty-eligible repair — both internal and external — should be performed.
• Generate a warranty claim that can be filed with the warranty provider.
• Alert technicians in real time to save warranty-eligible repair parts.
• Generate warranty core tags.
• Automatically apply negotiated warranty labor rates and parts mark-ups to confirmed warranty claims.
• Apply warranty experience to vehicle lifecycle history costs.BI