Engine damage: a possible opportunity
Engines don’t like being badly treated – and this is something of a headache for warranty holders. Maybe reman might be able to help, suggests Volker Schittenhelm.
Germany-based CarGarantie has been an international specialist warranty company for more than 40 years. It has framework agreements with more than 30 car manufacturers and importers’ associations as well as special offerings for the independent aftermarket. Its latest publication shows the share of cost-intensive engine breakdowns increased from 8.8% of total volume of all regulated component breakdowns in 2013 - to 11.2% in 2017.
Trends such as cost pressure for manufacturers, increased electronics, engine downsizing and increased use of turbochargers have an impact. Today’s engines are highly sophisticated and don’t take kindly to things like drivers’ tendencies to lengthen service intervals, poor driving behaviour and use of low-quality oils.
Looking at the cost segments for CarGarantie (see chart), engine damage/failure is - as expected – leading with 24.2%, followed by the fuel system (17.7%) and transmission (11.7%). The average repair cost per damage case is calculated at €514 (previous year €502), the highest growth for years.
FIRM sees an opportunity in this development. CarGarantie’s recommendation is a “repair cost insurance” for the driver or car owner. And as that car insurance company will certainly be open to solutions in order to reduce expenses for engine repair, it is the right moment to get in contact - as a national engine reman association - to evaluate framework agreements, for example, and to offer the high-qualified engine reman competence of each individual member. Make something out of it – CarGarantie works in 19 countries!
Find out more about CarGarantie here.