Chrysler offers lifetime powertrain warranties

updated 6:37 p.m. ET July 26, 2007

DETROIT - Chrysler Group raised the stakes in the warranty game Thursday, offering lifetime repairs for the key components of its cars and trucks sold in the U.S.

Chrysler’s lifetime powertrain warranty program replaces an existing three-year, 36,000-mile warranty.

Effective Thursday, Chrysler said the warranty applies to most of its vehicles and “covers the cost of all parts and labor needed to repair covered powertrain components — engine, transmission and drive system.”

It applies to retail sales of gasoline-powered vehicles and excludes sales to rental companies and other fleet users.

“The most expensive repairs are to the vehicle’s powertrain,” said Chrysler spokeswoman Patti Georgevich. “Therefore, we wanted to make a statement about our products while at the same time providing worry-free ownership to our customers.”

The warranty covers about 88 percent of U.S. sales under the Chrysler, Dodge and Jeep brands, said company spokeswoman Lori Pinter. DaimlerChrysler AG sold 1.11 million Chrysler, Dodge and Jeep brand cars and light trucks in the U.S. during the first half of 2007.

Germany’s DaimlerChrysler AG announced in May that it would sell an 80.1 percent stake in its struggling U.S. unit to Cerberus Capital Management LP.

The lifetime warranty could help draw new customers into Chrysler showrooms, particularly those who like to keep their vehicles for a long time, said Fred Ferguson, general manager of Lithia Chrysler Jeep Dodge of Burlingame, Calif.

Chrysler officials are always looking at “how we can make it in front of the pack,” he said. “Anything you can show the customer that they are getting something of personal value, it will help.”

With the new consumer protections, Chrysler leapfrogs U.S. rivals General Motors Corp. and Ford Motor Co., which last year extended their powertrain warranties.

GM began offering a five-year, 100,000-mile powertrain warranty, while Ford extended its warranties to five years or 60,000 miles on Ford and Mercury brands and six years or 70,000 miles on Lincoln models.

Ford based its warranty limits on the fact that buyers typically keep vehicles for four to five years, said spokesman Jim Cain. He said extending the warranties in 2006 reflected Ford’s confidence in the growing reliability and value of its cars and trucks.

GM said the declining number of its warranty repairs — down 40 percent since 2002 — made it possible to extend the warranty. “What’s important is you have the quality to back it up,” said spokeswoman Janine Fruehan.

Warranties by other automakers vary.

South Korea’s Hyundai Motor Co. offers a 10-year, 100,000-mile powertrain guarantee.

Toyota Motor Co. offers a five-year, 60,000-mile warranty for Toyotas and six years, 70,000 miles on the luxury Lexus brand.

“We feel our powertrain warranty is competitive in the marketplace today,” Toyota spokesman Bill Tong said from Torrance, Calif.

Chrysler said its warranty applies only to the first person who owns or leases a vehicle.

For the warranty to remain in effect, buyers need to have their vehicles inspected at a company dealer once every five years.

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