You Get The Best Value For It.

Most manufacturers offer basic warranty coverage, but some plans are better than others.

If you’ve ever shopped for a car, you’ve heard the term factory warranty. While its exact definition can vary in different situations, it always refers to some type of coverage that is offered by the original brand or manufacturer. In this article, we’ll get into the nitty-gritty of what factory warranties really are. We’ll also talk about extended warranties offered by manufacturers and other providers.

The factory warranty is a warranty covered through the car manufacturer to pays for repairs within a specific time frame and/or mileage after the purchase of the car. Factory warranties most commonly apply to new cars and may include a powertrain warranty, maintenance, corrosion, and emissions coverage.

Factory warranties are different from other kinds of warranties because they are backed by the actual manufacturer. A big difference between a factory warranty and a manufacturer warranty is that you don’t have to pay for a standard factory warranty. It is automatically included with your new car, though some forms may require a deductible for certain repairs.

Today, practically all brands offer manufacturer’s warranties on new cars. What these warranties cover differs between makes and models, but the basics are similar. Since major car brands are competing in the same marketplace, shoppers expect that most factory warranties will offer similar core coverage, though the details can differ between brands.

The term “manufacturer warranty” really includes more than one warranty. To understand what those are, we need to make a quick distinction between inclusionary and exclusionary warranties.

If a factory warranty is inclusionary, the contract will explicitly list every part that is included in the coverage. If a warranty is exclusionary, the contract lists the excluded parts instead. Exclusionary coverage typically covers more items, since there are thousands of parts that make up a car. However, the circumstances under which those parts are covered can vary.

Below are the main types of coverage that are typically included in a factory warranty.

Also called bumper-to-bumper coverage, this warranty covers defects in materials or workmanship for many parts of the car. This is an exclusionary warranty that often excludes wear items like brakes and tires, as well as environmental damage like external rust or windshields. The bumper-to-bumper warranty does not cover routine maintenance or damage from lack of maintenance. Damage from misuse – like taking a Cadillac offroad – isn’t covered, and acts of God like flooding from a natural disaster are also not covered.

What’s confusing is that people often refer to the basic limited warranty as the factory warranty. If you hear someone say, “The factory warranty lasts for 5 years or 60,000 miles,” this is the warranty they are most likely talking about.

The second core coverage that is a part of almost all factory warranties is the powertrain warranty. The powertrain is what it sounds like: the train of power from the engine to the wheels. Powertrain warranties will usually cover the following:

• Engine, including internal parts and the engine block
• Transmission or transaxle
• Drivetrain (2WD, 4WD, AWD)

The powertrain warranty is usually inclusionary, so the contract will list the parts that are covered. Under this warranty, coverage is only for defective parts or installations that were made at the factory. A transmission repair because of misuse or neglect won’t be covered. Some powertrain warranties may require a deductible for repairs.

There are a few more coverage types that can come with a manufacturer warranty. These include:

Before you decide if the cost is worth it, there are some disadvantages to consider, as well.

• Corrosion coverage: This warranty covers the cost of replacing sheet metal that has rusted through. It usually requires a hole to have formed in the metal, and it may not cover surface rust. Corrosion coverage can vary between different parts of the car.
• Roadside assistance: Many brands today offer roadside assistance. These programs can be tied to the powertrain warranty period, or they can have a separate duration. Some may also require deductibles or only offer allowances toward roadside assistance.
• Emissions warranty: Federal law requires emissions parts to be covered for defects. Most emissions parts are required to be covered for 2 years or 24,000 miles, though some parts like the catalytic converter or emissions control unit are covered for 8 years or 100,000 miles. Manufacturers can follow the minimum guidelines or offer more coverage for these parts.
• Maintenance: Some auto brands cover regular maintenance for a period of time. This coverage is usually short in duration. For example, Toyota covers regular maintenance on new cars for 2 years or 25,000 miles.