Consumers help GM post profit for first time in years
 Sometimes called an "extended warranty", a service contract is a promise to perform (or pay for) certain repairs or services. Although technically not a “warranty” as defined by federal law, service contracts may be arranged at any time and always costs extra. Warranties, on the other hand, ONLY come with a new car and are included in the original price. Vehicle service contracts are popularly referred to as "extended auto warranties" or "extended warranties". Use of the term "extended warranty" or "warranty" on this site is intended to refer to vehicle service contracts and not manufacturer's warranties.
On the back of North American sales, the bailed-out General Motors has reported that it earned $865 million in the first quarter, a sign that the effects of the economic collapse may be subsiding. As Americans bolster their own economy by buying homemade cars, it becomes important to protect these costly investments with an extended warranty.
The profit was GM's first since 2007. The government acquired 61% of GM in an effort to prevent it from collapsing, which could have devastated the economy. While some cried that the taxpayers were funding a public company, it appears that those same taxpayers have come to the rescue by buying from the beleaguered automaker.
Consumer confidence was shaken in the wake of reported financial troubles within the company, and in the fourth quarter of last year, GM lost $3.4 billion in North America. But this year, the company rebounded, with $1.2 million in profit in North America.
The report indicates that Americans are returning to the auto lots, and with that in mind, buying an extended warranty becomes an important consideration.
GM's standard warranty only protects the powertrain of the vehicle, including the engine, transmission, and axle. Drivers who want to protect their new car will want to look at wrap coverage, which protects the rest of the car.
Combined, this makes for a full bumper-to-bumper warranty that ensures drivers are covered in the case of breakdown. Think of it as your own personal bailout.
5/17/2010 10:53:14 PM
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