Tracing Errors and Preventing new Ones

Guarantee and warranty costs burden the automotive industry worldwide swallowing up tens of billions. They are a clear indicator that further improved processes and controls need to be established. The Formel D Warranty Solution Center (WSC) offers solutions for cost reduction and quality optimisation along the entire process chain.

If an ABS control unit in a vehicle fails, the situation might become difficult. In a workshop the part in question is quickly tested and replaced. But at this point, the problem is still far from being solved. What caused the failure, what is to do to prevent reoccurrences, and who has to pay for the repair works and the consequential costs? These questions are not easy to be answered.

The vendor is legally liable to the customer within a certain warranty period. This warranty period prescribed by the law has to be differentiated from voluntary guarantee and goodwill. Therefore, first the manufacturer of a good is not directly affected in the event of a warranty claim. The car dealer, however, wants the manufacturer to reimburse all material and labour costs. Now, it has to be clarified if the car dealer is entitled to claim reimbursement and if the request is complete, real and reasonable. In addition, it has to be determined whether the failure was caused by the manufacturer and whether the supplier can be held liable. The clarification process and the final reimbursement may take several months. And finally, in the interest of all parties concerned, the root causes of the failure have to be removed as soon as possible. This may only be achieved, if the OEMs in question have an effective warranty management.

High Costs and the Risk of Damaging the Image

The costs imposed on the automotive industry due to warranty claims are estimated to about 30 billion euros. Although the expenses made for guarantee service and goodwill have a great negative effect on the operating results of a company, responsible decision makers just slowly start to focus on appropriate management processes. In order to avoid high costs and damage to the image possibly resulting from recall campaigns, it is important to already take action in advance.

However, companies often do not apply effective processes to analyse defective parts and to identify the error and its root causes. Possible errors are: wrong handling in the workshop, a defect in production, development or design, a defect within a purchased part or a defect within a single component. At this point, the Formel D Group may come into play. By optimising warranty management processes and technologies, the Formel D Group facilitates a reduction of warranty costs as well as an increase in product quality. For this purpose, Formel D specialists take a close look at the entire process chain: from the dealer to the internal procedures at OEMs all the way to suppliers and sub-suppliers of single components or parts. But the Formel D Group does not only give advice but also organises the productive realisation. In this case, the service provider greatly benefits from its extensive experience in workshop management in the area of service and warranty hotlines as well as from its competences in performing and optimising diagnosis down to a guided and therefore secure way of error identification.

Management of Recourse Claims at MAN Truck & Bus AG

Since February 2010, the Formel D Group has cooperated with the department for management of recourse claims at MAN Truck & Bus AG. It supports the company in restructuring this task field which was previously part of the logistics area. The objective is to develop a targeted process with lasting results for dealing with supplier recourses. Besides continuing present procedures, optimising and integrating new processes was also defined as primary objective by the customer. Therefore, the responsible Formel D team primarily checked the supplier quality when analysing defective parts and simultaneously examined the application system for potential weak points. The team consisted of eight Formel D employees under the direction of the Munich Business Development Executive Mario Knop. At the same time and in a different approach, the specialists took a close look at the entire warranty procedure analysing the different processes. They now supervise and coordinate the next steps. “We support the experts who follow a trace and find the actual cause. Together, we correct the error or develop appropriate countermeasures”, Knop describes their work and emphasises: “After all, everyone is interested in good quality. I see us in the role of verifiers who start a quality campaign, raise awareness for this issue and demonstrate effective methods.” This helps the supplier as much as the manufacturer. The latter already gave a very good mark of 1.5 to the Formel D team in the area of customer satisfaction.

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