Warranty costs in 2003 could be reduced significantly with improved collaboration among vehicle manufacturers, tier one suppliers and their suppliers, according to the initial findings of a warranty analysis survey of the automotive industry conducted by BearingPoint in conjunction with Automotive News and the Original Equipment Suppliers Association (OESA).
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The BearingPoint survey, which involved more than 60 automotive suppliers, measured how effectively automotive suppliers and vehicle manufacturers were implementing internal warranty management strategies. The survey also sees the potential to standardise internal processes for more effective warranty management and increased visibility.
In order to achieve this, BearingPoint suggested: better access and ability to analyse warranty data, failed parts and systems; clear direction on design responsibility for OEM generated engineering changes; and early design involvement.
“These initial findings document that warranty performance is a key strategic issue, differentiator and growing risk element for suppliers,” said Wayne Stein, managing director of BearingPoint, a business consulting and systems integration firm.”The goal for us in conducting this survey is to provide insight into how these findings can be translated into significant costs savings for the industry overall.”
Other initial findings from suppliers’ responses included: 66% believe warranty charge-backs have become a significant cost-shifting strategy for automakers; 69% said they do not get enough information on warranty charge-backs; 90% said automakers are increasing their focus on analysing warranty costs; 50% said they are not sure who has design responsibility; 77% of supplier employees are not trained on warranty issues; 57% use multiple versions of warranty management systems, translating into high maintenance costs.
Final survey results are expected to become available in the spring.
