Capped price servicing under fire

[DJM83]

About time Dowling put his pen to something useful

THE Australian Automobile Association has warned that not all fixed-price servicing deals are created equal as figures show some budget-priced hatchbacks can cost more to maintain than a luxury car.

Seven of the top 10 selling brands now offer capped-priced servicing after Toyota introduced it in 2008. More than a dozen rivals have followed.

But in many cases the capped pricing runs out just before expensive routine maintenance begins, or doesn't extend as far as the warranty period.

Some brands require customers to take the vehicle into the dealership twice a year to make up for discounted prices.

In the most dramatic example of the differences that can be found - a $13,990 Nissan Micra hatchback costs $1584 to service over three years, more than 50 per cent dearer than it costs for regular check-ups on a Volkswagen Golf diesel ($876).

The Micra is even more expensive to maintain than a Toyota LandCruiser heavy-duty 4WD ($1260).

Comparing like with like, the new Nissan Pulsar costs $1641 to service, more than twice as much as a Toyota Corolla ($780).

The cheapest cars to maintain over three years are the Hyundai i20 ($567), Holden Barina ($740), Mitsubishi Mirage ($750) and Toyota Yaris ($780).

However, Hyundai's capped price servicing runs out two years before its five-year warranty ends, Holden requires customers to visit every nine months, and Toyota wants to inspect the car every six months.

Mitsubishi, which was second to market with fixed price servicing locally, was once the cheapest of the lot but increased prices across its range late last year.

Its servicing offer, too, runs out before the warranty ends.

Other anomalies: most diesel cars are consistently dearer to service than their petrol-powered equivalents. But in some cases the maintenance costs of diesel cars are cheaper in the initial service period, then rise sharply as the vehicle gets older.

Capped price servicing was introduced to take the guesswork out of car running costs and stop some rogue operators from over-charging.

Figures from accounting firm Deloittes show that the workshop and parts departments account for approximately half of a dealership's profit.

With slim margins on new vehicles as prices have fallen, dealers have used their service bays to make up some of the shortfall.

Before capped-priced servicing was introduced, prices varied markedly even among dealers representing the same car brand.

The AAA says it welcomes fixed price servicing but its endorsement comes with a warning.

"Capped price servicing does provide a greater level of transparency but people must read the fine print,'' Australian Automobile Association Executive Director Andrew McKellar said.

"Not all brands offer the same conditions or service period which means you may not be comparing apples with apples,'' he said.

"Do your homework and examine all the details such as how many services you get at that fixed rate and also how often the service needs to be undertaken.''

Given that fixed price servicing has taken some of the cream out of dealer profits, the AAA says motorists should be even more wary of upselling.

"Even under a fixed price service plan, owners still need to remain on their guard with some dealers trying to upsell to customers on work that isn't needed,'' McKellar said.

"Steer clear of unnecessary service suggestions from the dealer that might go over and above what is in the capped price special, such as a fuel clean, petrol additives or air conditioning decontamination.''

The AAA also reminds motorists that they are not obliged to take their car to a dealership for routine maintenance.

"A reputable independent mechanic may still offer a cheaper service on your new vehicle than the manufacturer's capped price deal,'' McKellar said.

"A log-book service can be undertaken by any licenced mechanic without compromising a warranty from the manufacturer, so don't be afraid to shop around."

Nissan Micra
Price: $13,990
Three years' servicing: $1584
Visits to dealer: Six

Volkswagen Golf TDI
Price: $36,490
Three years' servicing: $876
Visits to dealer: Three

Toyota LandCruiser
Price: $78,990
Three years' servicing: $1260
Visits to dealer: Six

Cheapest cars to service

Hyundai i20
Price: $13,990
Three years' servicing: $567
Visits to dealer: Three

Holden Barina
Price: $15,990
Three years' servicing: $740
Visits to dealer: Four


Mitsubishi Mirage
Price: $12,990
Three years' servicing: $750
Visits to dealer: Three

Toyota Yaris
Price: $14,990
Three years' servicing: $780
Visits to dealer: Six

Im not entirely sure what ill do with my ST, it does have capped price servicing (with anomalies) but i havnt asked my current mechanic what the cost might be