The Ram brand, a division of Stellantis, recently announced a major commercialization update to its warranty program. This strategic shift is targeted at holding on to existing customers and attracting new and younger buyers. The manufacturer is raising the stakes with an industry-leading 10-Year/100,000-Mile Limited Powertrain Warranty. That’s a big leap from the old five-year or 60,000-mile warranty. This expanded warranty now covers both consumer and fleet retail purchases and leases. It doesn’t count fleet purchases or Ram Promaster electric vans.
The new warranty provides coverage on popular key components. These parts make up the complete drivetrain, including the engine, transmission, transfer case, driveshafts, differentials and axles. This pioneering strategy increases customer faith in the Ram automotive group. It’s a welcome policy change at a moment when average pickup truck prices have hit nearly $70,000. Tim Kuniskis, CEO of Ram, said in a release announcing the new warranty that he is confident it will help improve customer loyalty and grow market share.
“We think this is going to be a significant move in the right direction.” – Tim Kuniskis
The move to offer the longer warranty comes at a time when consumer financing has reached a tipping point. Further, a recent study found that eighty-five percent of truck buyers finance their vehicles for seven years or longer. In effect, they are getting more than an average of 12 years of life out of their trucks. Kuniskis acknowledged that the increasing cost of living and vehicle prices are making customers uneasy. They are now more than ever looking for assurance that their investments are protected.
“Eighty-five percent of truck buyers finance for seven years or more. They keep it for 12 years because everything’s gotten more expensive.” – Tim Kuniskis
Ram’s warranty move is a direct response to Kia’s positive reception to their 10-year/100,000 mile powertrain warranty. This strategy has created intense brand loyalty in the automotive sector. If the brand is able to get a former customer back into the fold, Kuniskis argues that the long-term warranty pay off is well worth it.
He recognized the dangers of propagating extended warranties. That burden is especially harsh if it’s rampant quality issues that are plaguing the mass-produced vehicles.
“But you know what hasn’t changed? No one has changed the warranty. They’re investing more and more and more money in your brand, but you’re not investing more money to protect them.” – Tim Kuniskis