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Author: jvancil Two stars, 250 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 18054  
Subject: Re: Why no warranty war? Date: 1/25/2002 8:41 AM
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Why wouldn't Ford consider a longer warranty to counter GM price wars?
It seems to me like a good way to stand behind your product, increase resale value of your vehicles and since the negative effects of longer term warrantys wouldn't actually be realized for 3 years, it would mean putting off financial woes until (gulp) Ford is in a more profitable position.


I like this idea... but not for the accounting issue as I believe you must accrue for expected warranty costs in the year of the sale... not sure about that. But I like the idea for two reasons. One it shows a definite commitment to the quality of the product, and will cause the company to pay more attention to the quality. The second is that the foreign auto makers have already introduced the concept and it has made a great difference. 100,000 miles is nothing to a car today... except maybe for SOME of the domestic models. I think that a pre-emptive warranty strike would be a great idea!

John
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