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Demand for extended warranties grows

Whilst year-on-year the number of warranty quotes for ICE vehicles has continued to rise on average by 5% since 2020, EV warranties have grown by around 70% per year and hybrid warranties by around 40% per year.
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28/07/2023

ANALYSIS of extended warranty quotes-to-buy requests through Intelligent Motoring has revealed a pattern of significant growth for electric and hybrid vehicles.

Warranty quotes for Alternative Fuel Vehicles (AFVs) grew by 575% in 2022 compared to 2017. In contrast, quotes for Internal Combustion Engines (ICE) vehicles increased by 97% for the same period.

Whilst year-on-year the number of warranty quotes for ICE vehicles has continued to rise on average by 5% since 2020, EV warranties have grown by around 70% per year and hybrid warranties by around 40% per year.

Duncan McClure Fisher, Chief Executive of Intelligent Motoring, said: “Overall, AFV extended warranty quotes-to-buy accounted for 5% of all queries we received in 2022, either through our direct-to-consumer car ownership platform, MotorEasy, or through our white-labelled partner schemes. However, whilst ICE warranties still account for almost all quotes we provide, we can see the balance is beginning to shift at pace.

“There is clearly greater recognition amongst AFV owners that the cost implications of maintaining a new tech vehicle are not dissimilar to ICE vehicles and should be financially planned for, which is why we are seeing increasing levels of quote-to-buy activity from our MotorEasy members.

“However, customer-focused motoring services and member organisations are also recognising the benefit of providing value-add offerings through their own customer propositions, and in turn we have seen our portfolio of white-labelled partnerships more than double.

“Offering a dedicated EV or hybrid extended warranty allows our partners to boost customer acquisition and build loyalty, ultimately increasing financial resilience and ensuring the business continues to meet the needs of the ever-evolving automotive landscape.”

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Chris Wright

Chris Wright has been covering the automotive industry nationally and internationally for 30 years. Following spells with consumer titles he became News Editor of Automotive Management (AM), Editor of Automotive International, International Editor for Detroit-based Automotive News, and Editor of Dealer Update. He has also co-authored several FT Management Reports and contributes regularly to Justauto.com

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