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Dealership Servicing & Car Warranties

A big misconception in the car world, is that you need to have your car serviced at the dealership to maintain your warranty. Many consumers feel like it’s a fair trade-off: pay the high price of a dealership car service to maintain your warranty. But, do you really need to take your car to the dealership to maintain your warranty? 

Taking a look at your car warranty

Australian Competition and Consumer Commission (ACCC) specifies that, “a manufacturer’s warranty is a promise to the consumer that the vehicle will be free from defects for a certain period of time.” 

“Provided you service the vehicle in accordance with any such requirements, the warranty will remain valid. If the manufacturer’s warranty states that the vehicle can only be serviced by an authorised dealer, this may raise concerns under the Competition and Consumer Act.”

So, your warranty can specify that your car must be serviced by a qualified mechanic, to their specifications, and using quality and appropriate parts. Your warranty actually can’t specify that you must service your vehicle through a dealer to keep the warranty intact. There are many, many cases of car manufacturers implying you must service your car with them though. 

Why dealerships need you to go to them

Car dealerships surprisingly, usually don’t make their profit from selling new cars. They actually make a profit from selling on second-hand cars but not so much with the new ones. Dealerships rely on the revenue from car services, financing, and insurance to make a profit on new cars. In fact, according to CarsGuide, a maximum of five per cent of dealer’s profit (on average) comes from new car sales. They say 50 per cent comes from parts and servicing and 30 per cent from finance and insurance. Used cars account for 15 per cent — three times as much as a new car.

Do you need to use genuine parts?

Genuine parts are significantly more expensive than their aftermarket counterparts. Especially when it comes to European car services. Because the part is genuine and imported from the other side of the world. But, do you need genuine parts? According to the ACCC, no. As long as you use quality and “appropriate” parts. Obviously, the aftermarket parts wouldn’t be covered under your manufacturer’s warranty though.

What about software?

Another tactic dealerships use to convince car owners to service with them, is saying that independent mechanics are unable to run software updates for your car. Back in 2016, when Choice reported on this, they explained that while mechanics have enough general information to service your car, the computerised systems are becoming increasingly complex. But car manufacturers aren’t sharing the information on repairs and updates with these systems.

Industry bodies did sign an agreement in late 2014, saying they’d make all this information readily available to independent mechanics. In 2018, however, it was still an issue.

What about your logbook?

Your logbook can be really confusing. They often imply that you must have your car serviced at the dealer. There are spaces on the pages that ask for a “dealer’s stamp”, a “dealer’s signature”, or ask you to tick a box saying you’re an authorised dealer.

But the ACCC still says, “Even if the service page boxes in the logbook are labelled in this way, an independent repairer may sign or stamp the relevant page of the customer’s service logbook (once they have completed the service) without it affecting the manufacturer’s warranty provided any other requirements are met (i.e. the service is carried about by qualified staff etc.).”

So, where should you get your car serviced?

At the end of the day, where you get your car serviced is up to you. However, avoiding independent mechanics and religiously taking your car to the dealership for your service isn’t necessary to keep your warranty and resale value, or to keep your car in perfect condition.

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