The Truth About No-Cost Maintenance
Does the promise live up to the hype?
Free or no-cost maintenance is an enticing promise — and a major selling point for many automakers these days. It is intended to provide peace of mind for new car buyers by shaving off the hidden cost of regularly scheduled dealer maintenance.
However, the programs vary considerably from carmaker to carmaker, and the fine print of each is packed with caveats and exclusions. With few exceptions, such as a free oil change or two for a new Scion, no-cost maintenance is offered only on higher-end vehicles. So who's actually benefiting from the pledge of no-cost maintenance, and why do some carmakers offer extensive, multiyear no-cost programs, while others won't even spring for a tire rotation?
Birth of an Incentive
The inspiration for maintenance-based marketing probably wasn't customer outrage over the cost of a synthetic oil change, but an escalation of the rebate arms race. While a Toyota dealership might slash its Corolla prices to undercut the heavily rebated Accords available at a Honda dealer across the street, makers of higher-end cars must tread more carefully. "The American public has gotten hooked on rebates," says Tony Molla, spokesman for the National Institute for Automotive Service Excellence. "A lot of people won't buy a car without one. The luxury brands have always resisted. Once you lower your price, it becomes an expectation."
Offer a single rebate on a new BMW or Lexus, and the damage might be irreparable — customers could see the brand as less tony and more populist, and its value could slide. After all, the more expensive the vehicle, the less its profits are based on volume. To make money, each new Jaguar must justify its own higher sticker price and remain above the hand-to-hand combat that occurs among less exclusive brands. A no-cost maintenance program offers a kind of loophole, a value-based incentive that doesn't risk devaluing the brand. Presented in the right way, free maintenance can even have a rarified air about it — the automotive equivalent of a comped hotel room for a Vegas high-roller.
How Free Is Free?
Leaving aside the central paradox of these programs, which provide a perk to customers already willing to pay extra for a prestigious brand, determining the value of no-cost maintenance means digesting the details of each program. Land Rover offers free scheduled maintenance within the first six months or 7,500 miles, which covers an oil change and a check of the brakes, suspension and tires — but no tire rotation. Audi, on the other hand, will rotate your tires, but your free dealer maintenance is limited to the first 5,000 miles.
Longer, more comprehensive programs, such as Volkswagen's three-year Carefree Maintenance program, could mean hundreds saved on oil, and the chance of a serious problem being caught in its early stages. But they don't cover so-called wear and tear parts, such as brake pads. In the summer of 2009, only two programs covered wear and tear: BMW's Ultimate Service and Volvo's Safe + Sound. Even these deals have their own exclusions. Both companies will replace brake pads and brake discs. Neither program covers new tires.
Assigning a dollar value to any of these programs is nearly impossible, particularly since new cars rarely suffer serious, high-cost maintenance problems in their first few years on the road, much less their inaugural six to 12 months. We asked dealers around the country what sort of maintenance issues they see within a car's first year, and the answer was unanimous: none. Maybe a wiper blade isn't clearing as it should. In fact, Jaguar's first (and only) free maintenance can't even be scheduled until after a year has expired and the car has gone at least 8,500 miles.
To illustrate the benefits of its own four-year free maintenance program, BMW claims to have calculated the average maintenance cost of owning other cars for the same amount of time, ranging from $385 for a Saab to $1,112 for a Jaguar. Considering that a new BMW X6 starts at nearly $66,000, a program that saves you around $1,000 isn't exactly a showstopper. So while Volvo and BMW deserve credit for offering service above and beyond the other free maintenance programs, if the savings associated with no-cost maintenance are ultimately such a small fraction of the vehicle's price, why does anyone bother?
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The writer didn't mention MINI's maintenance program. I got three years of free maintenance, which included all my oil changes, fluid top-offs, brake service/replacement, and repair of a damaged fuel line. I even got loaner cars when I needed them. The only thing I've ever paid for is tires, which, unfortunately, are a bit pricey. However, my dealership values my business, and I appreciate their service. I'll keep driving my Cooper until it's nothing but a pile of bolts, then I'll buy another MINI.