Report:

Cover of Warranties in the Void

Warranties in the Void II

Released by: U.S. PIRG Education Fund

When you buy a new appliance, you have an expectation that it will work, at least for a few years. But sometimes, it breaks down quickly. So you call up the manufacturer to see about getting it fixed under your warranty. Sometimes they fix it, but other times they refuse. Sometimes their remedy takes so long you are forced to find another way to fix the product -- or you might just give up and buy a new one.

In 2018, our Warranties in the Void report found significant problems with appliance manufacturer warranties, including the widespread assertion that warranties would be voided due to independent or self-repair.

Nearly all appliances or electronic devices come with some form of written warranty to clarify when repairs would be covered, and under what conditions. When manufacturers choose to provide written or “express” warranties, there are laws that govern how they work. The guidelines from the Federal Trade Commission (FTC) advise that “[g]enerally, the [Magnuson-Moss Warranty Act (MMWA)] prohibits warrantors from conditioning warranties on the consumer’s use of a replacement product or repair service identified by brand or name,” with some exceptions explored later in this report.

According to our 2018 report, 45 of the 50 appliance companies surveyed stated that they void warranty coverage due to independent or self repair. We presented our findings to the FTC in hopes that, just as the agency had done to six companies earlier in 2018, they would warn non-compliant companies to address issues. But without public action from the FTC, we began to wonder if the earlier warnings, as well as the FTC’s “Nixing the Fix” workshop and investigation, had created enough pressure on manufacturers to improve conditions for warranties.

Meanwhile, appliance repair demand has surged in the pandemic. Factors include the increased use of home appliances as people are home more, and fewer people buying new appliances as both retail operations were restricted and the supply chain was interrupted by COVID-19. As repair needs surge, it can lead to delays in warranty service. When you can’t get a necessary appliance repaired in a timely manner under warranty terms, you might opt to attempt a repair yourself or hire another repair technician to solve the issues.

Unfortunately, in our survey, conducted in the fall of 2020, we found that all of the 43 companies we surveyed indicated that warranty would be voided due to independent repair. These companies either had clauses in warranties which claimed repair would void coverage, or their warranties were unclear and their customer service representatives, when asked, stated that independent repair would void the warranty. Conditioning a warranty to forbid independent repair is generally understood to be a violation of Magnuson-Moss.

Further, we found three companies didn’t make warranties readily accessible prior to purchasing a product -- another consumer right guaranteed under Magnuson-Moss.

We believe that our findings reinforce the need for the FTC to step up their enforcement of Magnusson-Moss.

Two years after these issues were raised, customers are still being told that they cannot repair their own devices, when independent repair may be more convenient or efficient for their specific needs. COVID-19 has further underscored why consumers must be given the option of repair choices without losing their warranties.

Companies can and should address these issues without waiting for additional enforcement actions, but it’s becoming clear that this is unlikely. Not only do previously cataloged issues persist, but there is no evidence that warnings to other companies, or a public workshop on repair restrictions, made any impact on how appliance manufacturers treat their warranties in regards to the right to independent repair.

We believe the prevalence of continued warranty concerns that undermine coverage for repairs also reinforces the need for better access to post-warranty repair.

If warranties are unreliable, consumers need more options to keep their products in working order and off the scrap heap -- best achieved by enacting Right to Repair reforms. Right to Repair laws, which have been introduced in 32 different states prior to 2021, and active in 26 states so far this year, would require companies to make tools, parts, manuals and schematics available to enable more third-party repair. Post-warranty repair options are limited when manufacturers don’t make replacement parts or service manuals available to consumers or independent repair shops.

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