Warranty vs Proven Reliability

[rScotty]

Warranties seem to be a big reason why people buy new things. But just how useful is a tractor warranty anyway?
Not all warranties are equal, or treated equally at all dealers. So what makes a good warranty and why have one?

From a manufacturing viewpoint, warranties are a big money saver. Putting a warranty on a product saves a lot of money compared to the cost of making one with less failures - or one that just cannot fail.

What about from the tractor buyers viewpoint - is a warranty worth the cost? Or would you rather have something else?

rScotty

 

[ericm979]

It's almost always cheaper to make the product reliable enough than to try to make up for an unreliable product with the warranty. But it's not always easy to do.

 

[sea2summit]

It's almost always cheaper to make the product reliable enough than to try to make up for an unreliable product with the warranty. But it's not always easy to do.

There's this term "planned obsolescence", it's a very real thing. Need to design it so it outlives the warranty....or make the warranty last until you want them to buy new? Big money to be made or lost with marketing plans tied to design/engineering.

 

[AndyMA]

There's this term "planned obsolescence", it's a very real thing. Need to design it so it outlives the warranty....or make the warranty last until you want them to buy new? Big money to be made or lost with marketing plans tied to design/engineering.

As a design engineer I've never been pushed to design a product fail at a certain point. Always designed the best product we could based on cost to build.

Andy

 

[rScotty]

As a design engineer I've never been pushed to design a product fail at a certain point. Always designed the best product we could based on cost to build.

Andy

I did design engineering for awhile (20 years) before going into another branch of engineering. We always designed something the best we could - and then sometimes had to battle over cost.

In my opinion, the whole concept of "designed obsolescence" is a folk tale. Maybe it started as speculation or a PhD project by some university economics or engineering department somewhere.
Planned obsolescence sounds good enough to be true - and maybe some where it is - but reality in manufacturing is that designing something to last a certain amount of repetitions then fail isl just about impossible.

It's hard enough designing it to last. Trying to hit a target of designed obsolescence would be incredibly expensive. Consider the testing time involved in each design iteration.... no way.

Not sure how it would relate to warranties, though.

rScotty

 

[rScotty]

It's almost always cheaper to make the product reliable enough than to try to make up for an unreliable product with the warranty. But it's not always easy to do.

Probably true. But where the warranty really saves the manufacturer dollars is in the component testing and resulting redesign. Testing is real time consuming and expensive. At some point you have to quit testing and put it on the market. Whatever is saved there, can be handled by the warranty.

If a manufacturer has been around long enough to have experienced designers, they have the luxury of going with the "best guess" by those experienced designers.
I think the "premium brand" tractors may fall in that category, although design excellence is oddly cyclic.
When it happens that way, the customer becomes the test department - and warranty becomes very important.

rScotty

 

[finn1]

Probably true. But where the warranty really saves the manufacturer dollars is in the component testing and resulting redesign. Testing is real time consuming and expensive. At some point you have to quit testing and put it on the market. Whatever is saved there, can be handled by the warranty.

If a manufacturer has been around long enough to have experienced designers, they have the luxury of going with the "best guess" by those experienced designers.
I think the "premium brand" tractors may fall in that category, although design excellence is oddly cyclic.
When it happens that way, the customer becomes the test department - and warranty becomes very important.

rScotty

Any manufacturer who relies on product testing is living in the past.

It’s all about upfront design, modeling and simulation now, and has been for over twenty years. Testing is more or less restricted to proof of concept and final product validation. The old ways of design, test, break, redesign rinse and repeat takes too long to get a product to market in a timely manner and is just too expensive.

Having worked in product development, I agree with the others that say planned obsolescence is some writer’s pipe dream. You design to meet product performance and cost targets, not to just make it through the warranty period.

Warranty failures are tremendously expensive to deal with and can bankrupt a company. I often said that the best cost reduction program is a redesign or process change to reduce warranty costs.

 

[AndyMA]

Any manufacturer who relies on product testing is living in the past.

It’s all about upfront design, modeling and simulation now, and has been for over twenty years. Testing is more or less restricted to proof of concept and final product validation. The old ways of design, test, break, redesign rinse and repeat takes too long to get a product to market in a timely manner and is just too expensive.

Having worked in product development, I agree with the others that say planned obsolescence is some writer’s pipe dream. You design to meet product performance and cost targets, not to just make it through the warranty period.

Warranty failures are tremendously expensive to deal with and can bankrupt a company. I often said that the best cost reduction program is a redesign or process change to reduce warranty costs.

Agreed, Manufactures alco need to retain a warranty reserve on their books to cover warranty costs. Typically about 6% of product cost

 

[Torvy]

In my experience, the more robust the warranty, the less likely it will be needed. Every manufacturing process will have potential flaws. The more parts, the more potential failures. Manufacturers with better processes and tighter tolerances and controls tend to have fewer problems than their competitors. That's one reason why I like to see aggregate data rather than anecdotes. Everyone knows of someone who had good luck or bad luck with a particular make/model. It is only in the aggregate that you can use data to reduce your chances of bad luck. Of course, most of us will still lament our decision if we draw the short straw.

 

[rScotty]

SNIP

Warranty failures are tremendously expensive to deal with and can bankrupt a company. I often said that the best cost reduction program is a redesign or process change to reduce warranty costs.

Wouldn't a redesign just add to the cost of the warranty repair?

The dealer still has to do the repair - and be compensated by the manufacturer - who now also has to design and make a new part, stock it, educate mechanics, and scrap all the old ones.

Established companies can probably survive that expense better than small ones.
So it sort of comes back to the question of what is a warranty worth....

Warranties from different brands may not be equal value even if they do cover the same things.

 

[WM75Guy]

 

[Torvy]

The best warranty is the one you never need to use.

When we first got married, my wife had a new Dodge Shadow. I had a 10 year old Nissan 200SX. Hers was frequently in the shop "under warranty". Mine never had any service done except regular maintenance or accident repair. Some people would say my warranty was worthless because I never used it. I thought it was priceless for the same reason. Warranty service never makes up for the inconvenience of needing it. Needless to say, we never bought another Dodge.

 

[Fixastuff]

A decent sized vermeer or ditchwitch vibratory plow costs around $220,000 and comes with a 1year warranty! Isn't that crazy.

 

[finn1]

Wouldn't a redesign just add to the cost of the warranty repair?

The dealer still has to do the repair - and be compensated by the manufacturer - who now also has to design and make a new part, stock it, educate mechanics, and scrap all the old ones.

Established companies can probably survive that expense better than small ones.
So it sort of comes back to the question of what is a warranty worth....

Warranties from different brands may not be equal value even if they do cover the same things.

Part of the analysis includes tooling, qualification, and warranty savings cost.

Redesign and cost reduction are ongoing processes for any manufacturer. The consumer may never know, unless the changes are large enough to require a part number change. Often it’s just a revision letter change on the drawing, and new services old.

 

[scootr]

I know warranties are a prudent purchase but they represent thousands of dollars spent for something we hope to never use .
I'm still of the mindset that If I think I need a warranty on this product then I probably need to find a better manufacturer.
I have told many car manufacturers as much

 

[murphy1244]

I have never used my warranty and to date has never been in the shop

 

[MapleLeafFarmer]

I like new warranties and new things / keeping it in great condition / keeping it forever. But what I like more is knowing someone is not passing off a well polished turd that turns out to be an expensive to repair/operate/dud of a turd.

I seem to find lots of really nice looking things at auctions and on various lots that when I dig into I find bubble gum glue, stripped bolts, duct tape repairs, etc... hidden.

But thats just me. Don't trust very new but used stuff or more so don't trust a lot of people these days.

 

[Iowa Hillbilly]

I did design engineering for awhile (20 years) before going into another branch of engineering. We always designed something the best we could - and then sometimes had to battle over cost.

In my opinion, the whole concept of "designed obsolescence" is a folk tale. Maybe it started as speculation or a PhD project by some university economics or engineering department somewhere.
Planned obsolescence sounds good enough to be true - and maybe some where it is - but reality in manufacturing is that designing something to last a certain amount of repetitions then fail isl just about impossible.

It's hard enough designing it to last. Trying to hit a target of designed obsolescence would be incredibly expensive. Consider the testing time involved in each design iteration.... no way.

Not sure how it would relate to warranties, though.

rScotty

In my manufacturing experience "designed obsolescence" is definitely a real phenomenon. I don't attribute it to malice on the part of the manufacturers. It is the result of competing design criteria which results in items that don't last as long as comparable products of generations past.

Consumers don't generally prefer to pay more if they believe they can get a comparable product at less expense. Most consumers are not capable of determining the engineering sufficiency or manufacturing quality of the products they buy. So if two items look pretty similar and make similar claims of performance and longevity, the consumer typically opts for the lower cost item.

To reduce product price and stay competitive one of the simplest techniques is to reduce component weights. The global supply chains for manufacturers of complex machinery like cars or tractors are mind boggling. Individual components get shipped from place to place across oceans and continents as raw materials become parts and parts become sub-assemblies and on and on until a final product is readied and shipped to a dealer's lot.

Another good technique to reduce cost is to change the material used to construct a part to a less expensive material. This often results in using a material less suited to the task, but it is an engineers job to try and make a component that is still suited to purpose, but less costly.

Overall, consumer price pressures and government efficiency edicts have guided manufacturers' engineering choices to produce items which are more lightly built and have shorter overall life expectancies. Are we all better off? Sometimes we are, sometimes maybe not.

 

[Fixastuff]

In my manufacturing experience "designed obsolescence" is definitely a real phenomenon.

What products have you experienced this with?

 

[Iowa Hillbilly]

What products have you experienced this with?

Large yellow equipment, large green equipment, large German equipment, US auto manufacturers, and a whole host of smaller and less complicated stuff that one might purchase at the big box store.