Check this important detail before signing that contract on a new car

When purchasing a new car that is sold with a warranty and maintenance plan, it’s critical to check when these after-sales agreements were activated.

Most buyers assume that the starting dates of their warranties and service plans commence on the day that they take ownership of the vehicle, but this is not always the case. Unscrupulous dealers may have activated these agreements months before, effectively giving you less coverage than what you paid for.

This could lead to you missing out on that last free service or being unable to lodge a warranty claim for something that went wrong on your car, despite being “within the parameters” of the original contract.

Why does this happen?

Writing in a BusinessLive column, consumer ninja Wendy Knowler brought to light a recent case in which she was approached by a KwaZulu-Natal resident who purchased a new Mercedes-Benz C-Class at a certified dealer in February 2018 with a six-year maintenance plan, and when he went to extend his contract at a time when he thought he still had eight months left, he found out he really only had four months left because the dealer activated the plan in October 2017.

The car was neither pre-owned nor a “demo” model, so there were no reasons the maintenance plan should already have been running for four months when he took ownership of the sedan.

The owner raised his concerns with the dealership’s finance assistant and insurance consultant expecting the issue to be rectified, but he soon realised this was not going to happen.

The employees assured the owner that his grievances had been escalated to the right people within the organisation and even Mercedes-Benz South Africa (MBSA), but not long thereafter, all contact ceased and his e-mails to the dealership started landing on deaf ears.

“When he stopped getting replies to his e-mails, [the owner] approached me” expressing concerns about the financial implications that the early expiration date on the maintenance plan could have, said Knowler.

“He was worried that should the maintenance plan expire in October, in keeping with the incorrect start date, the dealership may claim that they can no longer help [him] in rectifying the matter, denying [him] an opportunity to extend the maintenance plan.”

Knowler raised the issue to MBSA which immediately launched an investigation into the matter, and a week later, she was put in contact with the franchise executive of the dealership, who said “This matter was unfortunately not escalated to me.”

The executive proceeded to contact the owner C-Class and apologised profusely, promising to get to the bottom of the situation. He said he did not know how or why it happened in the first place.

“[He] is the first owner of the vehicle and should have had a maintenance plan that expired in February of 2024,” said the executive. According to MBSA’s records, however, the maintenance plan was activated by a different dealer in October 2017 and was due to expire in October 2023.

“I have gone through the deal file and all the relevant documentation and unfortunately don’t understand why, and can’t apply any insight or logic to it,” said the executive.

“However, it is clear that the error occurred on our side and the client should not be prejudiced in any way.”

The franchise proceeded to offer to pay half of the owner’s two-year extended maintenance plan fee, which he accepted.

This is not the first time something like this has happened, and it probably won’t be the last, with Knowler referencing a similar case from a few years ago at a BMW dealer.

“Subsequent investigations revealed that sometimes such warranties are activated without the car being sold — for example, when a customer cancels a deal at the last minute,” said Knowler.

“Another customer later buys the car off the new-car showroom floor, doesn’t check the warranty details, and finds out much later that the warranty on their car is a few months short.”

Therefore, checking when the warranty, service, and maintenance plans were activated should be on your to-do list before signing that contract on a shiny new set of wheels.