In the know: Under the bonnet of capped price servicing

If you are in the market for a new car, you may have seen some major car brands advertising ‘capped priced servicing’ to sweeten the deal. These programs are designed to offer transparency when it comes to service pricing, but how do they work and are there any limitations to them?

Getting your car serviced regularly can help keep the vehicle running as it should and increase your safety on the roads. However, a car service can be costly and the price you pay can vary greatly depending on a number of factors, such as the make and model of your vehicle and where you get it serviced.

To help offer prospective buyers some certainty as to the cost of scheduled services on their vehicles, many car manufacturers offer Capped Price Servicing (CPS) or even Lifetime Capped Price Servicing programs.

Below we break down the nuts and bolts of CPS schemes, including outlining the current programs on offer from some of the major car manufacturers in Australia, and what consumers may want to consider before deciding whether to enter into a servicing price plan.

What is capped price servicing?

According to the Australian Automotive Aftermarket Association (AAAA), capped price servicing is a “routine maintenance program” that offers new car owners a fixed or ‘capped’ price on some servicing requirements within a dealership network for a set period of time, provided that certain conditions are met.

This means when car owners have their new car serviced per their car manufacturer’s requirements, they will know ahead of time how much that service will cost.

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How does capped price servicing work?

CPS arrangements differ from car brand to car brand, but typically a manufacturer will publish a transparent servicing program for your car, usually on its website, which details the price for a service at a participating dealership that is carried out within a certain schedule. For example, some CPS programs may require services every 12 months or every 15,000kms (whatever comes first).

Car owners will generally need to follow the service schedule provided by their manufacturer in order to be eligible for the price quoted under the capped price servicing program.

How long these CPS programs last for your particular car will also depend on the manufacturer. For example, some Toyota car owners can access capped priced services for the first three to five years their car is on the road, depending on their vehicle’s model, while for Kia customers it is typically seven years. Some may also offer CPS for the life of the vehicle.

Some manufacturers’ websites allow customers to check their car’s CPS status via its VIN number, which can generally be found marked under the bonnet of a car, at the bottom of the windscreen or along the driver’s side door closure area.

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What do some of the major car brands offer?

Many car brands in Australia offer some form of CPS program, but the terms and conditions of each program vary considerably from brand to brand. Here is a list of what some of the major car manufacturers in Australia offer under their CPS schemes at the time of writing, according to information on their websites. These CPS offers are listed in alphabetical order, by brand name:

Ford

Capped price servicing falls under its ‘Service Price Promise’ program.
Eligibility and duration: Applies to almost all cars built from 2007 on and for up to four years.
Required servicing schedule: For most models, every 12 months/15,000kms (whichever comes first).

Holden

Capped price servicing falls under its ‘Know Your Cost Servicing’ program.
Eligibility and duration: Applies to all cars bought from 1 January, 2018 and lasts for the first seven services.
Required servicing schedule: Depending on the model, either every nine months/15,000kms or 12 months/12,000kms.

Note: Although the Holden brand has now been retired in Australia, Holden said it would honour all warranties and servicing offers made at the time of sale and would set up a national aftersales network to provide servicing and spare parts for at least the next 10 years.

Honda

Capped price servicing falls under its ‘Tailored Service’ program.
Eligibility and duration: Applies to almost all new models built from 21 July, 2015 onwards and lasts for five years/100,000kms (whichever comes first).
Required servicing schedule: Depending on the model, either every six months/10,000kms, or every 12 months/10,000kms. Honda recommends checking your service maintenance requirements in your Owner’s Warranty and Service Manual.

Hyundai

Capped price servicing falls under its ‘Lifetime Service Plan’ program.
Eligibility and duration: Applies to all models built from 1986 onwards, lasting for the life of the vehicle (until it can no longer be driven – including used Hyundai vehicles).
Required servicing schedule: For most models, every 12 months/15,000kms (whichever comes first).

Isuzu

Eligibility and duration: 19 MY (2019 Model Year) and later vehicle models are covered for capped price servicing on the first seven scheduled services for up to seven years/105,000kms (whichever occurs first). Earlier models include cover for the first five services for up to five years/75,000kms (18MY) or five years/50,000kms (16.5MY and 17MY). These benefits transfer with the vehicle if sold to another owner. Isuzu also offer a free 3-month/3,000km inspection (whichever occurs first) as part of its capped price servicing program.
Required servicing schedule: Isuzu states on its website for vehicle models earlier than 16.5 MY, service schedules are every six months/10,000kms (whichever occurs first); 16.5MY and 17MY vehicles every 12 months/10,000kms (whichever occurs first); and 18MY and 19MY and later models are every 12 months/15,000kms (whichever occurs first). The exact schedule for each model is set out in the vehicle’s warranty and service booklet.

→Related article: Top 10 selling cars in Australia

Kia

Eligibility and duration: Applies to first seven scheduled services (14 for T-GDI petrol turbo models) for up to seven years/105,000kms (excluding Kia Stinger and MY 19 and onwards petrol turbo models, for which the limit is up to seven years/70,000kms, whichever comes first).
Required servicing schedule: For most models, every 12 months/15,000kms (whichever comes first).

Mazda

Capped price servicing falls under its ‘Select’ program.
Eligibility and duration: Applies to all models, lasting for the life of the vehicle. The duration of the program can vary slightly depending on the model chosen.
Required servicing schedule: For most models, every 12 months/10,000kms (whichever comes first).

Mitsubishi

Eligibility and duration: Applies to all models. For cars sold from 1 January 2017, cover will last up to three years, while for cars sold before 2017, cover will last for up to four years.
Required servicing schedule: For most models, every 12 months/15,000kms (whichever comes first).

Nissan

Eligibility and duration: Applies to all cars (except GT-R) registered on or after 1 January 2018 for the first six standard scheduled services. Applies for up to six years/120,000kms (whichever comes first) on most models.
Required servicing schedule: For most models, every 12 months/10,000kms (whichever comes first).

Subaru

Eligibility and duration: Applies to all models, lasting up to five years, with varying kilometre limits depending on the model.
Required servicing schedule: For all-wheel drive models, it is every six months/12,500kms (whichever comes first), BRZ models are every nine months/15,000kms, and all other models it is every 12 months/12,500kms, whichever comes first in each case.

Toyota

Capped price servicing falls under its ‘Service Guarantee’ program.
Eligibility and duration: Applies to all cars, lasting for three to five years depending on the model.
Required servicing schedule: Locally made Camry, Hybrid Camry and Aurion (built before October 2017) and 86 models every nine months/15,000kms; imported Camry and Camry Hybrid (built from October 2017) and C-HR models every 12 months/15,000kms; all other models, every six months/10,000kms, whichever occurs first in each case.

What services are covered under capped price servicing programs?

According to Car Advice, services that are often covered under capped price servicing programs may include labour, genuine parts (which are made by the manufacturer and outlined within the regular service schedule), oils and fluids, and environmental charges (the costs for dealers to dispose of waste products from your car such as oils and brake fluids).

Car Advice said some of the things that are excluded from CPS programs typically include repairs for damage linked to a crash, tyre replacement, wheel alignment, the repair of aftermarket parts (those not made by the manufacturer), and the replacement of wear-and-tear items (such as wiper blades and brake pads).

Check the terms and conditions of the manufacturer’s capped price servicing program to see what items are covered and what is excluded.

If you are after a level of financial cover from loss or damage to your car caused by an accident or another defined event (such as a storm or fire), then you may want to consider purchasing a car insurance policy.

Why do some car brands offer capped price servicing programs?

The Executive Director of the AAAA, Stuart Charity, said CPS programs are usually marketed as “an enticement for purchasing a new car”, although he noted most car brands used them primarily as a customer-retention tool designed to keep service work and the purchase of parts and accessories within their own dealership networks, to improve profits.

Reading the fine print

While many car manufacturers claim that their CPS programs offer full transparency over pricing, Mr Charity said this was not always the case.

“For example, vehicle owners may not be aware that the cost of a CPS program may be built into the purchase price of that car,” Mr Charity said.

“In addition, many CPS plans do not cover critical service items as specified in the manufacturer’s own recommended service schedules. These services or replacement parts often come at an additional cost.”

Mr Charity said it was important that consumers carefully read the conditions involved in any CPS deal prior to purchasing a vehicle.

CarsGuide journalist Andrew Chesterton agrees with Mr Charity and said reading the fine print on capped price servicing programs is key. He also said consumers should check the current capped price on offer from their car manufacturer before they book their car in for a service, as some manufacturers reserve the right to change the price of parts of their programs at any time, such as the labour rate or oil and coolant costs.

→Related article: Australian car warranties guide

What to ask your new car dealer before entering into a CPS program

Before agreeing to a CPS contract, it may be a good idea to ask your new car dealer some questions regarding the program on offer, such as:

• What is the duration of this CPS program and when does it take effect?
• What is the recommended scheduling service for my vehicle under the CPS program?
• Are there any penalties imposed if I miss a scheduled service?
• Can I only have my car serviced at a participating authorised dealer for the capped price to be valid?
• Is the service price capped for the life of my car, or can these prices be increased over time?
• What items and services are and are not covered under the CPS program?

If you were satisfied by the conditions laid out from your new car dealer and have now purchased your new wheels, you may then want to explore your options when it comes to insuring your vehicle against loss or damage on the road.

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