Archived Copies of Warranty Week

December 2002 to Today

Worldwide Heavy Equipment Warranty Report: Claims were down a bit in 2021, but accruals rose significantly, as did product revenue. The industry's average claims and accruals rates both fell in relation to total revenue, but the combined warranty reserve fund balances of the 56 companies we're tracking in this industry grew 11% to a record $10.81 billion.
January 12, 2023
Worldwide Aviation & Jet Engine Warranty Report: Claims were down for the aircraft but up for the engines, while warranty accruals and reserve balances were up considerably for both groups. But warranty metrics in the aviation industry are still far below the peaks they set several years ago, before the pandemic caused demand for air travel to nearly cease.
December 15, 2022
Worldwide Auto Warranty Expenses: Most auto manufacturers have filed their latest annual reports, so the totals are in for 2021: $45.9 B in claims paid, a 2.4% claims rate, $54.0 B in accruals made, a 2.8% accrual rate, $128.4 B in reserves held, and $653 in accruals made per vehicle sold. Claims and accrual totals changed little last year, but because sales rebounded in 2021, the expense rates fell.
October 6, 2022
Worldwide Heavy Equipment Warranty Report: Claims were up a bit last year but warranty accruals fell significantly, as did product revenue. As a result, the industry's claims rate was also up a bit while the average accrual rate fell. And the combined warranty reserve fund balances of the 52 companies we're tracking in this category grew five percent to a record $9.81 billion.
September 9, 2021
Worldwide Auto Warranty Expenses: Last year, claims fell -10% to $43.9 billion while accruals rose +4% to $51.0 billion. And with some additional adjustments along the way, that drove worldwide warranty reserves up to a new record balance of $114.9 billion. And because sales fell so fast, the average claims rate rose to 2.8% last year, while the average accrual rate jumped to 3.3%.
September 2, 2021
Worldwide Jet Engine Warranty Report: Though some of the biggest manufacturers in the industry are also in many other lines of business, the warranty expense rates of the "pure play" jet engine makers remain close to industry averages. And while COVID grounded many commercial airliners, it didn't decimate the jet engine industry as badly as one might have guessed.
July 1, 2021
Worldwide Aviation Warranty Expenses: Although the world changed nearly instantly when the pandemic began, there's a lot of inertia in the commercial airline and business jet industries. So although the passenger count plummeted, the number of flights declined more gradually, and the warranty expenses even slower. Some even saw their warranty costs rise, while others recovered from past predicaments.
June 24, 2021
Assurant Inc. During the Pandemic: With a major share of the insurance underwriting for both retail appliance, electronics, and mobile protection plans as well as for auto dealer's vehicle service contracts and ancillary plans, the company is a bellwether for a large portion of the extended warranty industry, both in the U.S. and worldwide. And some peculiar things happened to both its revenue and profit rates last year during the pandemic and the lockdowns that resulted.
June 17, 2021
European Automaker Warranty Expenses, Part 2: In this latest part of a worldwide roundup of automaker warranty expense totals and averages, we find that VW has always had the highest costs, while the French companies have always had the lowest. This doesn't correlate well with either customer perceptions or reliability trends, but facts are facts, while opinions are subject to bias (and advertising).
May 27, 2021
Worldwide Heavy Equipment Warranty Report: Though the warranty expenses of the manufacturers rise and fall with the ebb and flow of construction and mining activity, many of the warranty managers have done a good job keeping expensed proportional to sales. Still, there are a few surprises in the worldwide data we've compiled.
October 1, 2020
Worldwide Auto Warranty Expenses: Now that most of the world's automakers publish their warranty expenses in their annual reports, it is possible to tally a global total for the industry. In 2019, claims were up but accruals and reserves were down, as were the number of vehicles sold and the product revenue they brought in worldwide.
September 10, 2020
American Auto Warranty Expenses: In this first part of a worldwide automotive warranty report, we find last year's slowdown turning into this year's slump. But the warranty expenses of the top U.S.-based automakers were actually up last year, and have failed to fall as fast as sales did this year, leading to increased expense rates.
August 20, 2020
Worldwide Jet Engine Warranty Report: While many of the engines for today's jet airliners are made by diverse conglomerates, there are a few "pure play" turbofan makers that bear watching. And even some of those conglomerates are shedding some of their non-aviation businesses to focus on commercial aircraft.
August 13, 2020
Worldwide Aviation Warranty Expense Report: If you assumed that warranty expenses in the aviation industry is proportional to market share, you'd be way off. Companies with comparable market-leading sales totals have vastly different warranty costs, and some of the leaders in certain metrics have much smaller market shares in sales.
August 6, 2020
Construction Equipment Warranties Worldwide: Unlike the automotive or civil aviation industry, a large chunk of the construction equipment industry worldwide does not report its warranty expenses. Still we did our best to fashion an industry estimate for their warranty expenses, relying on industry sales data to help plug the gaps.
October 24, 2019
Worldwide Aviation Warranty Expense Report: Warranty accruals were up last year, but warranty claims continued to fall. It's still too early for the cost of grounding of the 737 Max to show up in the data, but why are Boeing's warranty costs always much larger than Airbus? Meanwhile, Bombardier and Dassault saw significant spikes in their warranty expenses last year, while Gulfstream and Embraer saw slight declines.
October 10, 2019
Worldwide Automotive Warranty Expenses: With reliable warranty expense data in hand from 24 of the world's largest carmakers, we have calculated some worldwide metrics: $46 billion in claims, $50 billion in accruals, $115 billion in reserves, 2.14% average claims rate, 2.53% average accrual rate, and $543 in accruals per unit sold.
August 22, 2019
Worldwide Construction Equipment Warranties: Sales took a big jump in 2017, and so did warranty expenses. But the increases were more or less proportional, which means the warranty expense rates remained about the same. However, the industry's claims and accrual totals are still a bit below their pre-recession peak levels.
November 8, 2018
Worldwide Automobile Warranties: Manufacturers representing well over 90% of the world's car sales now reveal their warranty expenses in their financial statements. So we've fashioned estimates for the remainder to create some benchmarks for the industry's warranty expense rates: 2.6% of revenue and $577 per vehicle.
August 16, 2018
Worldwide Construction Equipment Warranties: With hard data covering almost three-quarters of the construction machinery sold worldwide, we manufactured an estimate of $2 billion for the entire industry's annual warranty costs. But we also found that sales are falling while warranty expense rates aren't changing much at all.
August 24, 2017
Worldwide Aircraft Warranty Report: With warranty expenses that exceed a billion dollars annually, the manufacturers of airliners, business jets, and propeller planes are a major sector within the warranty industry. And over the past decade, they have learned how to reduce warranty costs while increasing revenue, as demonstrated by their declining claims and accrual rates.
July 20, 2017
Worldwide Automotive Warranty Report: With hard numbers in hand for the warranty costs of roughly 80% of the world's car and light truck manufacturers, we set out to create estimates for the remaining 20%. And not surprisingly, we find that the highest warranty costs are in Europe and North America, with the lowest in Asia.
July 6, 2017
Heavy Truck Warranties: Six companies have 12 brand names that account for almost all the heavy trucks carrying freight on the highways and motorways of North America and Europe. And while it's not possible to figure out how much warranty costs on a per-truck basis, all six parent companies do disclose their total worldwide warranty expenses.
September 3, 2015
Warranty Accruals per Vehicle: The German OEMs still have the highest warranty costs worldwide, but the Japanese carmakers are no longer unopposed at the bottom. Both Fiat and Ford are cutting their warranty costs to within range of longtime low-cost leader Honda. And Toyota is well on its way to getting back to normal.
July 11, 2013
Japanese Electronics Warranties: Four electronics manufacturers that are based in Japan but export their products worldwide show below-average warranty expense rates. Part of the reason is what they make. But could part of the reason also be where they make it?
July 19, 2012
Warranty Accruals per Vehicle: While we can't say who builds a better car, we can figure out which automakers are budgeting for the lowest warranty costs per vehicle. Worldwide, Honda leads and Daimler lags, but the order of the six OEMs between them is somewhat surprising.
July 7, 2011
Toyota's Warranties & Recalls: For the first time ever, the automaker's worldwide recall costs have exceeded its warranty costs. And that has changed both what Toyota reports and how it gets reported in the company's financial statements.
June 30, 2011
Worldwide Auto Warranties, Part Two: It turns out that Volkswagen, BMW, and Fiat do disclose their warranty data, if one knows where to look and what to look for. And thanks to the help of a reader who's fluent in five languages, we now have hard numbers for the warranty costs of more than half the world's vehicles.
July 23, 2009
Worldwide Electronics Warranties: It's not where you're from as much as what you make. European and Japanese electronics companies report warranty expense rates similar to what their American competitors do. The difference is that while U.S. companies must report what used to be trade secrets, the international companies are simply doing their New York Stock Exchange shareholders a big favour.
July 9, 2009
Worldwide Auto Warranties, Part One: Why do Japanese automakers and heavy equipment manufacturers seem to have such low warranty costs? Though sales are down since last year, warranty costs remain under control, according to annual reports filed recently by Toyota, Honda, Komatsu and others.
July 2, 2009
Worldwide Warranty Providers: With the attention of Americans turned towards long weekends at the beach, barbecues and mountain getaways, we turn our focus to ten well-known international brands that are among the few non-U.S.-based companies to reveal their warranty expenses.
July 3, 2008
Ten Worldwide Warranty Providers: It's holiday time in the U.S. this week, so we're taking the opportunity to present warranty data for ten global brands based in other countries. Despite the currency and accounting differences, many pay warranty claims at rates close to those turned in by their U.S.-based peers.
July 5, 2007
Worldwide Computer Warranties: Thanks to exact data for U.S. product warranties and good data for worldwide market shares, we can estimate a worldwide figure of $12.3 billion for IT hardware warranties and $4.9 billion for PC warranties. With mobile phones, however, the precision drops because so much of the industry is based in Asia and Europe, where warranty data remains relatively scarce.
June 5, 2007
Worldwide Automotive Warranties: Sure there are good numbers for the U.S.-based automakers, but what about the rest of the world? With a few educated guesses, we're able to estimate the worldwide auto warranty number to be $36.9 billion, roughly 3.4 times U.S. figures alone. But it's different for every size of vehicle, and exchange rate and warranty duration also have an effect.
May 30, 2007
Warranty Financial Management: Part 2: Optimizing Warranty Reserves. Rightsizing a $100 billion dollar worldwide warranty reserve by turning lazy capital into working capital.
January 23, 2007
Auto Warranty vs. Quality: Does the total cost of warranty have any correlation to product quality? Based on the worldwide claims rates seen for the top five carmakers and quality data collected in the U.S. by J.D. Power and Associates, one does seem to be related to the other.
June 20, 2006