A new survey indicates the majority of drivers (63 percent) don’t have active extended warranties for their vehicles.
The survey by Pegasystems reveals a disconnect between appreciating the importance of an extended warranty and actually purchasing one. Sixty percent of survey respondents said they believe warranties provide value, while 62 percent of consumers with active warranties reported benefitting from them within the past year.
According to the survey results, the biggest barriers to consumers purchasing a warranty are: cost (35 percent); not thinking they need one (32 percent); and lack of availability at the time of purchase (29 percent).
Nearly half of those surveyed (48 percent) indicated they only somewhat understand their existing manufacturer’s warranty, and 7 percent say they don’t understand it at all.
The survey points to generational differences in vehicle buyers’ opinions on extended warranties.
Younger consumers are the primary buyers: Fifty-four percent of 16- to 24-year-olds have an extended warranty, while only 25 percent of those 55 and up have an extended warranty, according to the survey results.
Generational differences also surfaced when respondents were asked how well they understand their existing manufacturer’s warranties. Nearly 40 percent of 16- to 24-year-olds said “very well,” while only 22 percent of those 65 and older said the same.
“When it comes to aftermarket owner and user experiences, there is an urgency for auto manufacturers, their captive finance divisions and dealer partners to intelligently orchestrate the fragmented channels, processes, decisions and data necessary to cultivate more loyal customers – whether it’s helping consumers with extended-warranty purchases or providing more seamlessly connected ownership and user experiences,” said Steven Silver, vice president, industry market leader – manufacturing, Pegasystems. “By understanding buyers’ experiences on a deeper level, the industry can provide more personalized recommendations and effortless interactions that protect customers’ automotive purchases long-term, as well as better experiences every time consumers use their vehicles and dealers service them.”