The Car and Truck Fleet and Leasing Management Magazine

BMW Launching Warranty Program for Older and High-Mileage Vehicles

February 19, 2004

BMW of North America LLC is launching an extended warranty program for older and high-mileage vehicles to boost sales of used vehicles that dealers sell a second or even a third time, reported Automotive News.

Dealers at the BMW make meeting heard details about the program, which is being introduced this month. "When the certified user comes off lease, we can inspect and sell cars with a BMW warranty and maintenance," said Tom McGurn, general manager of retail and industry relations.

"With older cars we can offer a powertrain and maintenance contract," he said. "The dealer can remarket the car with up to 100,000 miles of coverage and certify it for the second and the third time."

BMW's new-car warranty includes all maintenance for four years or 50,000 miles. A certified used car, if the new-car warranty is still in effect, gets another two years or an additional 50,000 miles of coverage.

The new used-car program includes extending maintenance coverage for as long as six years or 100,000 miles. That coverage is extra and varies according to the model. "There are various packages for older certified cars that can extend the coverage for seven or eight years," McGurn said.

The program is expected to boost BMW certified used-vehicle sales. BMW sold 65,693 certified used cars in the United States in 2003.

BMW also told dealers about new programs to recruit and train dealership employees. BMW is attempting to have courses offered through its BMW University training program for college credit, said Frank Ursomarso, owner of Union Park BMW in Wilmington, Del., and NADA line chairman for BMW.

BMW also is working with the Automotive Youth Educational Systems to certify the curriculum offered to student technicians in vocational high schools and to have them sent to BMW dealerships, Ursomarso said. "Dealers are concerned with hiring and retaining good help and working with BMW to give young people a career path," he said.

Other areas of discussion at the make meeting included urging dealers to prepare for the launch this month of the X3 SUV, which is smaller than the X5, and the 6-series coupe and convertible, which go on sale at the end of March.

The X3 is priced at $31,000 and could bring BMW new buyers, Ursomarso said. "They want them to make sure with a new vehicle that we all understand what we're doing."

The 6-series cars will put BMW into segments where it hasn't competed for years, Ursomarso said: "We told them the car is coming, and to make sure and train your people."

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