It’s very sad when any business has to close its doors and lay of its staff and it’s particularly sad, when it’s another part of our dwindling manufacturing industry, such as Birmingham van maker LDV.
Around 4,000 jobs will go with the announcement that LDV has gone into receivership and that’s awful, but there are further implications here and that’s for the LDV customers who had remained loyal, but now find that their 4 or 5 year warranty’s mean absolutely nothing, leaving them to pick the tab up for every repair.
Until 2007, an LDV came with a 5 year warranty (the longest in the business), which was then reduced, and replaced with another industry busting offer, this time, a 4 year 120,00 mile warranty and clearly, for many buyers, the warranty was a major factor in them deciding to purchase an LDV.
LDV spokesman Guy Jones stated that LDV are no longer in a position to honor warranty payments and can no longer pay their dealers for any warranty work they carry out. He did say however the LDV dealer network is working to support them on this.
Quite what that means, I don’t know, but because of the circumstances, LDV dealers are not obliged to pay for any warranty and in these difficult times, I can’t see any of LDV’s 132 dealer’s picking up the tab for £100’s of pounds of repairs that would previously be funded by LDV and that means there is only one option left and its to charge the customer for work that would previously have been done free of charge under the LDV warranty.
We are not talking small potatoes here either as its thought up to 30,000 vehicles probably should still be covered by some form of warranty at this point and estimates suggest that warranty costs for this year alone, could be over £1 million pounds! (and don’t forget, some of the vehicles out there could still have 3 years left on their warranty) and as we all know, vehicles cost more to maintain as they get older, so who knows what he real cost to LDV owners will actually be?
So what’s the likely scenario, well no one really knows but clearly, were there some hope that LDV could rise from the ashes, the dealers would want to keep their existing LDV customers happy so that they continue to buy from them, once LDV had reformed with new owners, so they might pick up the tab to keep you sweet, but looking at the situation at the moment, that’s appearing very unlikely, but anything seems possible these days, so who knows. Its possible even that without LDV getting back into business, that some servicing dealers might support their own customers through this, in the hope they will buy their next vehicle from them (albeit a different make).
So it seems it’s down to the relationship you have with your local dealer as to how you’re going to be dealt with and maybe you should be contacting them and asking if they have made a decision on how they are going to handle this.
Now, as you can imagine, there are still a number of unsold LDV vans laying around, which are now no longer supported with warranty and as such, these are not going to be easy to move, however one van supplier has announced they will offer a 12 month warranty on any new LDV’s they sell and whilst it’s a long way from the 4 year warranty that should have originally come with the vehicle, the warranty covers parts & labour for all mechanical and electrical faults and provides some other assistance such as covering the costs of any public transport expenses you might experience as a result of a breakdown, as well as proving overnight hotel accommodation.
Started this piece off by saying how sad it was that LDV has found itself where it has, but fact is, the product was not the equal of its competition, the technology was older, they were not as good to drive and pound for pound, they lost more in value than most of their alternatives, so in real terms, even with heavy front end discounts, frankly, in my opinion, they just didn’t stack up well enough and clearly, I was not the only person that figured that out.
