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generally occurs when a vehicle is delivered to the carrier for
shipment to the dealer, at which time title passes from
petitioner to the dealer.
Petitioner provides written manufacturer's warranties to the
retail purchasers of its new vehicles. These warranties inform
purchasers that the scope of the written warranty covers defects
in their vehicles, provided that the defects occur during normal
use and within specified warranty periods. The written
warranties provide in part that petitioner will provide repair or
replacement of defective parts or workmanship without charge.
Generally, the written warranties are of two types, basic
warranties and extended warranties. Basic warranties typically
provide coverage for 1 year from the warranty starting date (the
date of original retail delivery or original use, whichever
occurs first). Extended warranties generally take effect when
the basic warranty has expired. Petitioner's extended warranties
frequently are valid for 5 years from the warranty starting date
or until the vehicle has 50,000 miles, whichever occurs first.
In some instances the extended warranties have shorter periods,
such as 24 months or 24,000 miles.
Before petitioner can provide the warranty service required,
the owner of a vehicle has to return the vehicle for service,
generally to the selling dealer. Petitioner’s dealers perform
the service and then make a claim on petitioner for
reimbursement. In the event the vehicle owner is traveling or
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Last modified: May 25, 2011