SOLUTIONS SYSTEMS INC.

POWERTRAIN FOR LIFE

FAQ

Solutions Systems Inc. features an inexpensive and effective "Powertrain for Life" warranty that applies to new and used cars. It is underwritten by a major insurance carrier with a long auto warranty history and an "A" rating every year for the past 100 years. This is not an F & I product. This promotional warranty is to be included on all new and used cars and is not to be charged to your customers. This lifetime warranty stipulates that, in order to remain valid, routine maintenance (oil change and tire rotation) be done at your dealership. This should increase your service retention to over 75%. There is no contract required and no up-front cost to the dealer. This program is only being offered to new car franchise dealerships. Please review our most commonly asked questions. We look forward to working with you and your dealership.

Will this "Powertrain for Life" negatively affect my extended warranty penetration?

No. Actually, the opposite is true. History has shown a 15% increase in extended warranty penetration by the business office because this program increases customer awareness for additional protection. Electrical, brakes, suspension system, fuel system, seals and gaskets, steering, air conditioning, roadside assistance, rental car, and towing are not covered on this plan, and customers desire coverage for those items.

It this an F & I product?

No. The cost of this warranty is included in the suggested retail price of each vehicle.

Who underwrites this warranty?

Great American Insurance Group of Cincinnati, OH. They are one of America's largest specialty insurance companies, and have been in business since 1872. They have had at least an "A" rating (by A.M. Best) every year for the past 100 years. Their parent company, American Financial Group, has $26.4 billion in assets, and is listed on the New York Stock Exchange (symbol AFG).

What statistics do you have regarding this program?

In the first 12 months of this program, Great American reports that, on average, dealers':

  1. New car sales are up 14%.
  2. Used car sales are up 19%.
  3. Service contract penetration is up 15%.
  4. Pre-paid maintenance contract penetration is up 29%.
  5. Front-end gross is up $248.

What other benefits will we see from this program?

This warranty differentiates your dealership from others in your area. You are now "Home of the Powertrain for Life". It helps dealers sell more new and used cars. It enables them to ask for more money for each car. It will keep these buyers coming back to the service department for the life of their vehicles. It is vital to dealerships to retain their customers. It takes much more time, money, and effort to attract new customers than it does to retain established customers!

What is the dealer's cost for this plan?

When the vehicle is sold, the cost for the Powertrain Warranty is $198 for new vehicles, and $329 for used vehicles. There is no contract or up-front cost.

Why is this so inexpensive compared to other used car warranties?

This is a warranty underwritten by a long-standing insurance company with an excellent reputation. Its cost has been lessened due to the following features:

  1. The warranty is non-transferrable.
  2. The customer must bring the vehicle to the dealership for routine maintenance for the life of the vehicle. If they don't, for whatever reason (they forgot, moved out of the area, etc.), then the warranty is void.
  3. Warranty does not cover problems incurred during the first 3 months or 3,000 miles after the purchase date of the vehicle.
  4. Dealer must include warranty on all qualified new and used cars.
  5. Dealer must be new-car franchised to qualify.

Can I pick and choose the vehicles that I want covered by this powertrain warranty?

No. This warranty will be included on all sold vehicles. The intent of this program is that you want all of your customers coming back to you on a regular basis for service. Nationally, dealers retain only 11-19% of sales customers as service customers. Service means sales. JD Powers and NADA report that dealers retain only 29% of sales customers as repeat sales customers. This program will dramatically raise those percentages.

Are there any vehicles exempt from this warranty?

Coverage is good for all new vehicles, and for all used vehicles up to 9 years old with up to 85,000 miles at the time of the sale. This includes all domestic and foreign vehicles with the exception of premium car lines such as BMW, Mercedes, etc.

Is there a termination point for this warranty?

The coverage is good for the duration of the customer's ownership of that vehicle, provided the owner brings the vehicle back to the dealership for routine maintenance (see warranty contract) for the life of the vehicle. This warranty is not transferrable.

Must the used cars be certified, or have a safety check, to qualify for this powertrain warranty?

No. That is not necessary.

Must the customer come back to the service department for ALL routine maintenance in order for the warranty to remain valid?

Yes. The customer must have their oil changes and tire rotations performed at your service department. Please see the Lifetime Powertrain Loyalty Program Certificate for details.

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