Know the difference between a warranty, service plan, and maintenance plan

The competition guidelines for the automotive aftermarket that came into effect on 1 July 2021 have made it imperative for vehicle owners to know the difference between a warranty, service plan, and maintenance plan.

The guidelines will see manufacturers separate the price of service and maintenance plans from the selling price of a new vehicle, with consumers now allowed to service their vehicle at, or fit parts from, their preferred independent service provider (ISP) – without automatically voiding their warranties, TopAuto reports.

Legal firm Bowmans said these competition guidelines do not have the force of law, however, and that you might risk voiding your car’s warranty by going the ISP route.

Below, Kate Elliott – CEO of Right to Repair South Africa – explains what after-sales agreements are on offer to car buyers, and what you should look out for to avoid costly mistakes.


Warranty

“A warranty is provided by the car manufacturer and provides the assurance that the manufacturer will repair or replace any parts that fail prematurely – where no external factors have caused the failure, such as [an] accident,” said Elliott.

New cars typically have a “comprehensive warranty”, roadside assistance, and a corrosion warranty included, with the availability and duration of these agreements varying by manufacturer.

“Previously, manufacturers would void your warranty simply for the act of taking your vehicle to an ISP for a service. Now with the guidelines, the manufacturer is not permitted to void a warranty if the vehicle has been serviced correctly at an ISP who conforms with the manufacturer specifications,” she said.

However, motorists are not allowed to take their vehicle to an ISP for warranty-related repairs, as these parts must be replaced by the manufacturer, said Elliott.

“Examples of what components may be covered under a warranty include the engine (including turbochargers); fuel system and fuel pump; drive shafts and axles; brake components, etc.”


Service plan

“A service plan covers service parts and labour used in accordance with a car manufacturer’s (OEM) service schedule,” said Elliott.

This includes oils, filters, spark plugs, and air filters, as well as other parts that are typically replaced during a scheduled service.

“As a consumer you are entitled, when you buy your car, to get a separate service plan with details about what will be looked at each service and for the average price on parts to be changed or checked,” she said.

Service plans exclude maintenance items that may be needed as a result of modifications, accidents, or misuse of the car.

Before the new guidelines took effect, service plans were included in the total price of a vehicle and it was not always possible to buy a separate one.

“The manufacturer must now provide you with separate prices for the vehicle and the service plan and give you the option not to purchase a service plan if you would prefer to pay for your services on an ad hoc basis at a service provider of your choice,” said Elliott.

“However, if you have elected to purchase a service plan, you must take your vehicle to the dealer for your services.”

If you take your vehicle to an ISP while also having a service plan, the vehicle manufacturer is not obliged to pay the ISP for services rendered.


Maintenance plan

If a certain repair or part is not typically included in a regular service, it may be covered in the maintenance plan, said Elliott.

Labour costs are generally covered through this plan, too, she said.

“What exactly is covered, however, will vary from manufacturer to manufacturer and the customer needs to check which items are covered by the plan with the car manufacturer where they purchased the car.”


Read: These are the cars you can afford with your salary in South Africa

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Know the difference between a warranty, service plan, and maintenance plan