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Labor warranty on parts installed along with major repairs
Posted to Shop Management Forum on 3/7/2017 55 Replies

I searched the archives to see if this was previously addressed and could not find a case of it. So, here goes...

In the course of replacing and engine or a clutch for example, the rear main seal is replaced not because it's leaking or maybe because it is, doesn't matter. Since the rear main seal is easily accessed during such a repair, I generally charge .5hr to 1.0 hr. for the installation. That's it, installation of a part, not the actual repair. So, suppose that rear seal fails in the next year or 12K miles (my warranty term); how do you guys deal with that? Do you a.) replace it under your parts & labor warranty; even though you never really got paid to do it the first time. b.) replace it with a new seal(part is guaranteed) but charge the labor you did not charge when you installed it at the discounted rate, since it was accessible at the time; or c.) Charge full labor to replace the seal and provide a seal for no cost?

I'd like to hear other perspectives on this and how to present it to the customer so they understand up front how this works when you/they circumvent the normal labor costs associated with a repair, while performing nearby repair. This has been an issue in the past and my policy is difficult to explain and seems to blow people away. Maybe because they are playing dumb or maybe because they simply don't understand that they have to pay for an installation at full price to get a warranty replacement/re-installation for free.

So here's my presentation: "Mr. Smith, I have replaced the engine in your car with a used engine which has a 90 day warranty. The rear main seal was leaking, normally, this is an expensive repair if the engine is in the car. As we previously discussed, it's smart to replace the rear seal before installing the engine so that you don't have to do it later and pay the higher cost due to labor. The seal itself, has a 12/12 warranty but the labor to replace it is not warranted. IF it fails and has to be replaced, the usual labor charge to replace it will be charged. The part has a warranty, but installation is not covered. If the seal starts leaking and you pay usual labor charge to have it installed, the entire repair will be warranted for the duration of the original part warranty and the labor will be warranted for 12/12 from the second date of installation."

This eliminates the problem of installing said part and feeling/being compelled to replace a 5-6.5 hour job part for free. They like to think that since you installed it, it has the same warranty terms as if you did the repair specifically for the rear seal. Just because you saved them money installing it when it was easy, should not mean that they win if the part fails and never pay the actual price to replace that part.

Another common situation is replacing cam and crank seals when replacing a timing belt. The Belt job works out fine, but the front crank seal or a cam seal starts leaking. So, mostly we seem to charge a small amount per seal in addition to the timing belt labor. I've had to replace a cam seal that failed and it was a lot of work to do for the .5 additional I got when I installed the seal. Every time we offer to fix a problem before it becomes one or save someone $, it should not put us in a position to lose $$$. This is why I discuss this with people up front. What do you guys do, think, suggest? There must be a better way to present and deal with this kind of thing. I don't have a full warranty policy printed on the reverse of my invoices like they do at the dealerships.

Robert Nissen
Nissen Automotive, Inc
Angier, North Carolina, USA

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