Ford's 2005 warranty repair costs were $3.986 Billion, which was 2.6% of product sales. Maybe a small percentage, but it's a really huge number.
GM's 2005 warranty repair costs were $4.696 Billion, which was 3% of product sales. The only good news for GM is that the warranty tab dropped in the first quarter of '06 to less than Ford's.
Compared with Ford and GM, DaimlerChrysler's warranty claims have been all over the map, but almost always hugely above the other two. From Warranty Week, here's the warranty claims rates for the big 5 automakers from 2003 to 2006:
The chart shows that the perception of Toyota and Honda quality is borne out by the reality of their warranty claims rates: flat. Then take a look at Chrysler. The numbers are significantly higher and erratic. That matches their perception of quality too.
When Chrysler, Ford and GM get their quality up, their warranty costs will go down. And that will mean their profits will go up. After all, you don't hear Toyota crying the financial blues like GM.
Until the quality goes up, if you've got a lemon, don't go it alone. Know your Lemon Law rights and don't let Detroit run over you!
ABOUT THE AUTHOR
Known nationwide as a leading Lemon Law attorney, Ronald L. Burdge has represented literally thousands of consumers in "lemon" lawsuits and actively co-counsels and coaches other Consumer Law attorneys. From 2005 through 2018, attorney Ronald L. Burdge has been named as the only Lemon Law Ohio Super Lawyer by Law and Politics magazine and Thomson Reuters Corp., Professional Division. Burdge restricts his practice to Lemon Law and Consumer Law cases. The Ohio Super Lawyer results are published annually in the January issue of Cincinnati Magazine. Ronald L. Burdge was named Consumer Law Trial Lawyer of the Year 2004 by the National Association of Consumer Advocates, the nation's largest organization of consumer law private and government attorneys. "Your impact on the auto industry has been magnified many times over because of the trail you blazed for others," stated NACA's Executive Director, Will Ogburn. Burdge has represented thousands of consumers in Ohio, Kentucky and elsewhere since 1978 and is a frequent lecturer to national, state and local Bar Associations and Judicial organizations. Burdge is admitted to Ohio's state and federal courts, Kentucky's state courts, and Indiana's federal courts. Other court admissions are on a "pro hac" temporary, case by cases basis.