Automotive Warranty Management – Setbacks, Solutions & Opportunities for OEMs

“Technology is not just a tool; it is the foundation of modern customer experience.” – Brian Chesky, Co-Founder of Airbnb

The prowess of technology in building credibility among customers is simply unmatched. It is the ultimate gateway for thriving companies to optimize their market outreach and obtain efficiency in operations. From product evolution to service expansion, a tech suite can enhance many aspects of business growth.

However, it plays the most pivotal role in streamlining complex internal processes which is why leading automotive enterprises are starting to digitize their operations, including the process of warranty management. From spare part identification and defect analysis to warranty approval, everything can be managed using software applications.

Automotive warranty claim management is associated with numerous vital touchpoints of efficient collaboration with dealers, suppliers, and end customers. Despite being just a fragment of OEMs’ role in the supply chain, the overall warranty process drastically affects their credibility. Therefore, it is essential to simplify warranty claim-related operations which is possible with automation.

This blog is an extensive walkthrough of how warranty management is accomplished by automotive OEMs, common setbacks involved in the warranty claim cycle, and solutions based on technology implementation!

Automotive Warranty Management – A Step-by-Step Look Into the Process

Even a simple car typically consists of over 30,000 spare parts and this number can vary from vehicle to vehicle, depending upon its design and features. A warranty request is raised by dealers in the case of damage, repair, or replacement. You must know that the vehicle manufacturer is not responsible for all warranty claims and some of these costs are reimbursed by the supplier as well.

The following section provides a bird’s eye view of the warranty claim request & approval cycle from dealers to OEMs and suppliers. Let’s take a look:

1. Dealers receive a repair or replacement request when a customer approaches them with an in-service part or component failure. In addition to fixing the issue, dealers also notify OEMs. After identifying the problem and fixing it, dealers prompt a claim request to OEMs in which they provide every detail related to the case.

2. After receiving the claim request, OEMs begin the assessment process to investigate what went wrong with the part or component and how much they should reimburse the dealer for the repair. This evaluation process also allows them to figure out whether the reimbursement needs to be done from the supplier’s end or not.

3. OEMs use a warranty database to review the terms of warranty and other guidelines before finally approving a claim. Suppliers are brought into this loop only when vehicle manufacturers identify that the recovery needs to be done from the suppliers’ side.

Setbacks in Automotive Warranty Management 

Flow of the Warranty Info – From Dealers to OEMs

It is worth noticing that OEMs collaborate with a large network of dealers. Hence, there is a possibility that claim filing or issue reporting may differ from dealer to dealer. In this end-to-end claim filing and approval process, there are a lot of opportunities to reduce time consumption and eliminate any potential instance of human error.

Claim Analysis by the Vehicle Manufacturer

An OEM is required to maintain a warranty database consisting of reimbursement terms, history of warranty claims, and other details that streamline the evaluation of requests prompted by dealers. The warranty-related information is accessed for diverse functions within the internal team network of vehicle manufacturers.

This information is also useful in finding out the root cause of the failure and bringing transparency to the reimbursement process. In addition to this, manufacturers also need to accommodate a concise system to strategically assign approvers who thoroughly review each claim.

In this case, a dire need to maintain a warranty claim database and authorize its secure access within the team comes out as a challenge for OEMs.

Warranty Cost Recovery 

The lack of effective and transparent warranty cost recovery is another inevitable setback of the automotive warranty claim management process. In general, suppliers are required to bear the cost of in-service failures resulting from their parts and components. But, there are several other expenses in warranty claim management such as replacement labor, repair, and logistics costs.

When there’s any lack of transparency or communication, such issues can cause disputes between OEMs and suppliers at the time of reimbursement. Sometimes, both sides decide to share the overall warranty cost in which the supplier pays for the part and the OEM pays for logistics.

However, it doesn’t work out so conveniently all the time. With automation of the claim, OEMs can establish warranty policies and share them with their network of dealerships and suppliers to ensure smooth claim approval and reimbursement.

What Difference Does Warranty Management Software Make? 

A streamlined automotive warranty management process revolves around several crucial factors such as enhanced communication, easy claim filing, pre-sales policy setup, and uncompromised transparency. Therefore, it can be concluded that the solution to all the above-mentioned warranty-related challenges lies in automation.

In this section, we will discuss how the warranty claim process gets better with the help of automotive warranty claim management software:

  • Easy warranty claim filing for dealers is a functionality that not only saves dealers a lot of time but also enables automotive OEMs to sustain a strong relationship with their dealers’ network. At the time of requesting a warranty claim, dealers choose from diverse templates and add the needed information as per various claim types, starting a fuss-free warranty process that they can conveniently track in later stages with updated info.
  • Configuration and administration of warranty policies on a centralized system is a benefit of automotive warranty management software. In simple words, it provides OEMs with more authority on the overall claim inspection and approval processes. With an automotive warranty claim management platform, vehicle manufacturers get to define terms related to part/component coverage, reimbursement, and warranty policies.
  • Collaboration and reduced time consumption are the outcomes of an automated warranty claim process. These advanced platforms come with a comprehensive claim filing feature, letting dealers upload media and other supporting documents and expediting warranty approval for the approving team assigned by the OEM.
  • The automation of supplier recovery is another powerful functionality that allows vehicle manufacturers to systematically identify who should be reimbursing for the warranty. These platforms have a logic-driven feature that facilitates supplier claim generation after approval.

There are many other features in automotive warranty claim management software that collectively empower vehicle manufacturers to effectively manage hundreds of warranty claim approvals, prevent claim frauds and use its insights to enhance after-sales services.

Why OEMs Trust Intellinet Systems for Warranty Parts Management 

Automotive OEMs can leverage a warranty parts claim management system to efficiently complete claim requests, organize their resources for faster claim approval, and maintain strong collaboration with both dealers and suppliers. All-in-all, warranty automation can benefit manufacturers in innumerable ways.

If you are looking for the right software solution for warranty management that can offer the above-mentioned benefits, you can choose Intelli Warranty. This software is designed to efficiently manage end-to-end warranty processing from claim filing to supplier recovery.

As a pioneering name in aftermarket software solutions, we tailored the platform with a distinctive aim to resolve every problem OEMs face during a warranty request approval cycle. From claim fraud detection to streamlined work queues, it includes every feature that can contribute to improved operations and reduced overhead costs.

Do you want to revolutionize automotive warranty claim processing? Book a free demo now to see how Intelli Warranty benefits your business or connect with our experts to learn more about it.