Inflated Net Warranty Expenses from Poor Supplier Recovery

Automotive aftermarket distributors and OEMs absorbing these costs can easily miss out on hundreds of thousands to several million dollars annually in recoverable supplier-caused warranty spend, as only the largest campaigns are escalated. • For an OEM with tens of millions in annual warranty spend, failing to move supplier recovery from ~15% to ~30% can easily leave $3M–$10M per year unrecovered in supplier-responsible costs, plus additional internal handling cost from manual investigations. • Large retail chains can forgo millions annually in supplier credits and reimbursements, effectively funding suppliers’ quality issues through inflated net warranty and return handling costs, including logistics and write-offs.

Analyst exports claims data into Excel, manually filters for repeat failures by part number, VIN/batch and supplier, then uses email and ad hoc PowerPoint or PDF summaries to argue for cost sharing or reimbursement from suppliers on a campaign-by-campaign basis. • Production schedulers and quality teams manually reconcile warranty claim reports from OEM portals with ERP production data and supplier delivery records using Excel trackers, email threads, and ad‑hoc SharePoint folders to build recovery cases and allocate costs. • They manually piece together supplier recovery cases by exporting warranty claim data from ERP/DMS, cross-checking with quality incident reports and 8D files in shared drives, and then building claim packages and cost breakdowns in Excel and email threads before submitting them to suppliers.