2020: Two Warranty Case Studies & Good Video

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KAH 24

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Within OEM Operations—I believe that my director report who quarterbacks warranty/claims discovery division is a true customer advocate with feedback from dealerships to back it up (she is extremely meticulous, honest, fair and perhaps one of the most objective/customer focused professionals I’ve worked with). She should be MY boss and hopefully will keep rising in the company—as I consistently state and believe that all in my team are far smarter and I am privileged to work with them.

Case Study 1: Great Win/Win for All—excellent example of service on warranty claim (2020 review):

—Full Size Premium 2015 SUV purchased CPO in 2016 with full dealership maintenance history. Consumer declined dealer extended warranty/opted for 3rd party company (duration until 2022)
—Vehicle serviced by dealership from 2016-current, above severe service maintenance intervals adhered to, with full service records.
—Vehicle had an aftermarket 2” lift installed in 2018 by a non-dealership which is still in business (with dealer notes that consumer went with aftermarket in order to fit slightly larger tires).
—Vehicle had P-rated tires replaced (same time in 2018 when lift installed) with LT-tires, 2” larger, but AT vs. street oriented.
—Customer diligently continued SUV servicing by dealership with the 2” lift and bigger tires.
—At 105k miles, vibration in the drivetrain was reported by consumer and documented by service (also the shifting was perceived as not as good). NOTE: Truck was still under aftermarket warranty, and consumer was still getting this captured by the dealership in our data base.
—At 109k miles, customer had dealership service and capture “shifting from 4H/4L was difficult”. “Customer asked dealership to see if the dealer could suggest anything”. Dealer documented that all was fine.
—At 120k (just before aftermarket warranty expired)—transfer case shifting from 4H/4L was like shifting rocks between gears with signs of damage within the transfer case.
—Dealership created situation where the issue had to be escalated by consumer to corporate.
—We looked closely (this vehicle was meticulously dealership maintained from CPO purchase to issues occurring).
—This consumer had 100% service performed by the dealership with documentation—from CPO purchase until time of failure.
—Replaced all parts (transfer case, axles, driveshaft for good measure, and put factory P-rated SUV tires back on SUV—the owner was thrilled by this)
—Dealership did not want to lose the customer—and could have provided a better customer experience.
—Coachable moment and the dealership identified the personnel issue and resolved.
—Every company wants this customer for life and help train/coach dealerships.
—Customer left very happy (and purchased a new 2021 full sized Premium SUV at end of 2020).

Case Study 2: Lose/Win—sad example of dishonesty which led to a less than desirable outcome:

—2019 “Off Road” marketing designation SUV.
—Customer bought this new/fully loaded with “tough/overland looking components” (installed as part of an aftermarket appearance package).
—Customer then (soon after purchase) added CAI, aftermarket tuner, tire size recalibrator (to change shift points/speedometer to account for larger tires and aftermarket wheels). Customer added a factory approved aftermarket exhaust installed by dealership.
—Customer had a ledger of service records for maintenance performed by aftermarket shop who did the installs.
—Initial documentation of drivetrain concerns at approx 19k miles/1yr (from new) based on the aftermarket shop affidavit.
—Driveshaft vibration and significant “clunk/clunk” when shifting from P/R and P/D (imagine a loud clunk when shifting from part to reverse or to drive).
—At approx 20k miles: removed tuner, tire size/transmission shift point recalibrator, put the brand new set of stock wheels/tires (which was obvious as they looked brand new), and “wiped” all evidence of tuner, recalibrator, tire/wheel installation.
—Consumer brought in SUV at 20k miles for warranty claim (clunking noise and transmission worries).
—Dealership documented/confirmed that there were issues—but that “had never serviced the vehicle and believe it may have been modified by owner”.
—Dealership denied warranty claim for drivetrain concerns which escalated quickly/badly.
—Gentleman’s parents hired an attorney to sue the dealership (which then involved us).
—Lawyer vs. Lawyer: Our resources dedicated to accuracy vs. yours where we now may dig deep.
—Affidavits: Please have your client sign stating that they have not modified the vehicle and disclose that we will conduct research to gain information sufficient to determine the root cause of the issue. We are simply working to ensure that OUR rights are protected as well as YOURS—since you initiated this legal action
—Client signed affidavit: no aftermarket modifications (tuner, shift kit, oversized tires/wheels)
—Discovery went quickly: the aftermarket shop that sold the tuner, shift kit—confirmed the vehicle.
—Discovery continued: independent wheel/tire shop that received the wheels/tires and then installed: also performed the oil/filter services (far more frequently than needed).
—The sellers/installers stated correctly that they had nothing to do with this. They sold the parts, but would agree that they were installed on the vehicle.
—The OEM dealership was 100% correct: as they had analytics/reputation for being above board in working with customers.
—I don’t know what happened between the attorney/his client—but they kept at it for a while even after confronted with facts (billable hours for them)
—This was a loss for whomever paid the legal bill for that attorney—and for whomever had to fix the truck.
—This was a loss as someone perceives that the drivetrain on the truck was faulty (we will never know whether the drivetrain was flawed or if the mods did it—because there was so much deception going on).
—This was a win for the dealership who preserved their reputation for honesty.
—Technically this was a win for the independent wheel/tire and tuner/trans recal aftermarket—as they were honest and did the right thing (although they were likely shocked beyond belief).


3. Now to lighten the mood hopefully—a funny video on YouTube regarding F-150 tuning/warranty. This gentleman was engaging and was spot on, with a genial manner.

 
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1BAD454SSv2

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What about oem not being honest with known design flaws and part quality issues? Cam phasers as an example. Early on there were a lot of denied warranty for phasers because of mods. Have not seen it lately. But early on it was. Or gen 1 raptors some had axle shafts not hardened correctly and warranty were denied when they broke while offroading. Early ecoboost with condensation issues and popping engines because slug of water entered engine a ton of denied warranty for those because of a few mods. My 2002 lightning broke 3 connecting rods at 9000 miles. Known issue even was stated in book Iron Fist lead foot written by John Colletti guy in charge of svt at the time. My Engine was replaced under warranty. Why should I be on hook for $10000+ dollars was the bill because ford put $46 worth of connecting rods in the engine. I had catback exhaust and Cai and tires showed signs of excessive wear. Of course when tow truck dropped truck off it was all stock and good tires. Guess I'm going to hell.

02 Lightning 28,000 miles.jpg
 
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Idaho

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@KAH24 just for some context, what is your position in relation to all of this...?

Part of warranty at Ford or a legal firm that focuses in warranty work?
 
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KAH 24

KAH 24

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@KAH24 just for some context, what is your position in relation to all of this...?

Part of warranty at Ford or a legal firm that focuses in warranty work?

@Idaho SVP for a Japanese auto corporation. Warranty is one of the divisions under my oversight. One of my closest friends heads legal and we discuss every difficult situation where I have to make a decision. In my immediate family we own Fords, several Japanese SUVs, a Rubicon that is the only car that takes the brunt of my aftermarket “experiments”, and a few other items. My wife is an attorney (corporate, formerly healthcare litigation).

I’m candid about my biases given both my various military and corporate engineering positions. Overall, I see the mind numbing budget expenditures on warranty claims as necessary in my role—but encourage OEMs to use every tool at their disposal to uncover fraud/dishonesty anywhere along the chain (as it steals from honest folks).

I enjoy my Raptor and view Ford F-series trucks as very well built/reliable vehicles. Personally I enjoy driving it more than either of my wife’s SUVs, but have my own positive biases about their reliability.
 
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GordoJay

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@Idaho
I’m candid about my biases given both my various military and corporate engineering positions. Overall, I see the mind numbing budget expenditures on warranty claims as necessary in my role—but encourage OEMs to use every tool at their disposal to uncover fraud/dishonesty anywhere along the chain (as it steals from honest folks).

Are any of the OEMs noted for effectively weeding out dealer fraud? I'm not asking you to **** on anyone, just a compliment if one is warranted. I already know of a couple OEMs that don't seem to give a rip about it. :(
 
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KAH 24

KAH 24

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Are any of the OEMs noted for effectively weeding out dealer fraud? I'm not asking you to **** on anyone, just a compliment if one is warranted. I already know of a couple OEMs that don't seem to give a rip about it. :(

@GordoJay Good morning and yes, dealer fraud is dealt with through an escalation process with significant potential consequences for negatives/rewards for positives. Analysis of trends/data occur down to a granular level—to look for variances that fall outside of defined ranges. In humor, that is what our interns are sometimes tasked with.

General example: why does dealer X have significantly more claims (approved/rejected) for Y condition vs. 10 dealers within a defined radius? Lots of factors are assessed—which in a competitive industry is critical (revenue and brand reputation).

My peers at competing OEMs do the same things, but the “secret sauce” of how I weight things vary from how they may weight things. That’s why I am very passionate and black/white. Call it corporate chess.

Rather than call out OEMs by name, I will say that in my career experiences—consumer perceptions of the OEM are generally most influenced by their dealership experiences (see above). The defense industry is where it is strictly OEM—for clear reasons.

What I will say with pride is that my OEM (thanks to my immediate predecessor, predecessors in leadership hierarchy, and brand philosophy) has a track record and clear reputation for having very little tolerance for poor dealerships.
 
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KAH 24

KAH 24

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KAH24 what about know design / and part quality problems with OEM? Every OEM has issues

@1BAD454SSv2
Easy answer. This is why there are factory recalls, TSBs, etc. Nothing man-made is perfect and design flaws exist.

I have/always will consistently state that integrity/honesty is non-negotiable to me (whether OEM personnel, dealer personnel, or consumer). It simply disgusts me to see the amount of rationalization for dishonesty that occurs—but to each his/her own as long as it isn’t around me.
 

1BAD454SSv2

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Same with me until corporation tries to pass the buck to the consumer. Look at ford 6.0 diesel fiasco , cost a lot of consumers ton of money , loss in value. After Working for major corporation for 30 years you learn all they care about is the stockholders.


I believe you work for Toyota . didn't you just pay a big fine?

Toyota has agreed to pay a $180 million fine to the United States government over violations of Clean Air Act protocol that went on for a decade between 2005 and 2015. The violation was related to timely reporting of defects that interfered with some cars' tailpipe emission regulation systems.
 
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KAH 24

KAH 24

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Same with me until corporation tries to pass the buck to the consumer. Look at ford 6.0 diesel fiasco , cost a lot of consumers ton of money , loss in value. After Working for major corporation for 30 years you learn all they care about is the stockholders.


I believe you work for Toyota . didn't you just pay a big fine?

Toyota has agreed to pay a $180 million fine to the United States government over violations of Clean Air Act protocol that went on for a decade between 2005 and 2015. The violation was related to timely reporting of defects that interfered with some cars' tailpipe emission regulation systems.

@1BAD454SSv2

If you need to rationalize a lack of integrity, do it with someone else. Do what you need to do.

Please let me know if this did not address accurately:

1. I work for a Japanese OEM and own a Ford Raptor.

2. Unethical practices by any individual or corporation—consequences result as they should.

3. Shareholders are people who invest in a company—they benefit from honest and ethical behavior.
 
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