Mondial reports increase in warranty sales

Mondial Assistance, the UK’s 2nd largest motor manufacturer warranty services provider, is reporting a year-on-year growth of up to 8% on FSA regulated warranties. Whilst new car sales are making tentative steps towards recovery, the used car aftersales market thrives says Mondial, bringing real revenue opportunities.

Liz Grindell, Warranty Manager for Mondial Assistance in the UK, explains, “Across the board, our figures show that more and more dealers are focusing on warranty to boost cash flow and customer loyalty. Warranties that form part of manufacturer ‘approved used’ schemes have been integral to vehicle sales for many years, but their benefits are really shining through in the current economic climate. Dealers are eager to extol their virtues as they add value to the vehicle.

“Warranty registrations are exceeding levels recorded last year, which were up on 2007. In addition to a rise in FSA regulated warranty sales, we have seen a 7% increase in non regulated warranty registrations for some of our Manufacturer Approved Schemes.

“We are witnessing people keeping their vehicle for longer, as they are being cautious about making a large financial outlay when the economic outlook remains uncertain. This means consumers are extending their existing warranty package. Alternatively, some car owners who don’t usually purchase warranty cover are buying a package to help avoid unexpected costs.

“Those dealers willing to add new products to their portfolio will ensure they are able to provide the right service for all customers. For example, our MOT test failure products offer flexibility and customer retention by providing tangible benefits. We continue to support dealers, with a range of unique and innovative products, but only with focused sales efforts will dealers begin to reap the benefits warranty can clearly offer their business.”

Mondial Assistance’s warranty top tips for dealers

Do ensure sales teams tell customers about the benefits of the inclusive warranty given with the sale of the car – it’s a natural lead-in to extended warranty

Do link the features and benefits of the warranty to the specific needs of your customers

Do combine the warranty message with other customer contact campaigns such as MOT reminders

Don’t disregard warranty as “it doesn’t earn much commission” – it’s about long-term profit and customer retention

Don’t forget to train staff to help them sell

Don’t assume the customer won’t want cover, letting them go without bothering to ask is a fundamental flaw!