If that's what's required to maintain leadership
Kia Australia says it'll do what's required to protect its unique selling point (USP) of offering the best warranty in the business, with consideration for a longer warranty already underway.
Speaking to CarAdvice in Brisbane this week, Kia Motors Australia chief operating officer, Damien Meredith, said the company believes it already offers the most comprehensive warranty in Australia, but will look at other options if that becomes threatened.
“We are happy where we are with the seven-year [unlimited kilometre, transferable] warranty,” Meredith said.
“One of the things that has been helpful in our growth is our consistency, consistency with our programming and our warranty, it’s not a ploy or a marketing thing, it’s there for our customer to look at our brand and that’s exactly what has happened.”
Kia sales have grown massively since it implemented its seven-year warranty in October 2014, but other brands like Holden and Honda now match that – albeit as a temporary marketing and sales strategy, rather than a full-time commitment.
Tesla is perhaps the only company that has gone a step further, offering an eight-year warranty (although not unlimited). In the United States, Kia offers a 10-year (160,000km) warranty, and that period is something that Kia Australia may consider in order to stay ahead.
“We will always look at other options, in regard to protecting our selling proposition. It takes a bit of tenacity to go with a seven-year warranty… what we have done is we have put some above the line advertising that we have made it clear that it’s forever [unlike Honda and Holden].
"That has worked quite well, but we will look at it (longer warranty periods) and protect our patch.”
According to Meredith, other manufacturers using the extended warranty as a sales strategy rather than a permanent pillar of the brand will confuse the market long-term.
“Honda went from three to five, and then all of a sudden they started programming a seven-year warranty two minutes after they went to five... Let’s see what happens in a few year’s time when you start getting confused when you have four different types of warranties out there at the same time.”
For Kia, if it chooses to extend its warranty, it will be done in a permanent, confusion-free manner according to Meredith.
“Everything we do, it’s like a mantra with us, the customer has to understand, the dealer has to understand, the general manager, the salespeople have to understand it and we have to understand it. If you get that right through, it works a lot better. Everyone understands what’s going on and there is no confusion.
“What Kia look at is three things; customer, Australian Consumer Law and the ACCC and you got to put into place what you think is the best for those three pillars with what you do," he said.
"We are pretty confident that a seven-year warranty blankets those three things very, very well, if it doesn’t then we will look at what is necessary for us to make sure the customer is happy so that we are in line with ACL, and we don’t get in trouble with the ACCC.”
Asked whether a longer warranty would be under consideration for Kia to maintain its market-leading position, Meredith confirmed it was on the cards.
“If we did anything, we would do unlimited... [we] might have to do 10 years unlimited, but for those three things to be covered, if we had to do 10 years unlimited, we would look at it.”
Would a 10-year unlimited kilometre warranty from Kia mean more to you than the current seven?