WARRANTY CLAIMS ADMINISTRATION AND RECORDS

Prudent business principles would suggest that dealers should ensure proper warranty procedural and administrative controls are in place within their respective service organizations. As a general observation, it is evident that this is not always the case. We are strongly recommending that increased attention to given to the overall administrative and/or communication process that transpires between the customer, service advisor, technician and claims clerk. Recent experience has shown that the majority of problems with warranty claims substantiation would not have occurred had the practice and procedures outlined in this bulletin been followed. Adherence to these procedures will assure compliance with the Cadillac Service Policies and Procedures Manual and prevent misunderstanding with regard to warrant claim payments and possible subsequent review and dealer chargebacks. (Please note, that the use of computerized repair order invoicing systems does not preclude adherence to the published policies and procedrues. Any in-house dealer systems should be designed in such a manner that ensures compliance to Cadilla requirements.)

With respect to the review and audit process, Cadillac has developed comprehensive new management computer systems which profile, monitor and analyze dealer warranty activity. This computer approach to expense monitoring has most recently led to dealer chargebacks resulting from communication breakdowns between service advisors and technicians with regard to catalytic converter campaign procedures, as well as parts managers and claims clerks with regard to no charge assembly exchange programs. Future applications of the systems approach of monitoring warranty expenditures are unlimited and will allow us to identify administrative deficiencies in a more timely manner.

Therefore, the following information is intended not only for Service Department management, but for service advisors, technicians, parts personnel, accounting personnel, and of course warranty claims personnel. In addition, we have requested the personal involvement of dealer principlals in assuring this information is disseminated, discussed and practiced by affected personnel.

1986 Service Pol. & Proc. Item Page No. ---- --------

1. Service bulletins are mailed to dealers as 139 & 140 the need arises. They contain important product and/or administrative information for dealer service personnel. It is imperative that dealers closely adhere to both the technical and administrative procedures published in these bulletins.

Dealers should pay particular attention to the VIN ranges of affected vehicles contained in certain bulletins to assure claims are not submitted for work on unaffected vehicles.

2. During initial Repair Order (R.O.) write-up, 75 a brief description of each customer complaint item must be listed.

3. All details of cause and repair (correction) 76 must be noted on the face of the shop copy of the R.O.

4. Each. R.O. must be signed by owner/user and a 75 & 77 copy given to owner/user after repairs are completed.

5. Any work added on after owner/user has signed 75 R.O. must be approved and initialed by dealer service management prior to the actual repairs being performed.

6. Labor operation numbers and times will be 76 determined by dealer management. If straight time is requested, the actual time required to perform the repair must appear on the face of the shop copy of the R.O., explained in detail and initialed by dealer service management.

7. The name and/or number of the technician performing 76 the repair must be on the face of the shop copy of the R.O.

8. The shop or hard copy of R.O.'s must be retained in 77 V.I. number sequence.

9. Technicial time tickets, stubs, strips or handwritten 76 must be included on the back of the shop copy of the R.O.

10. If a separate customer R.O. is used, it must be 77 cross-referenced with warranty R.O. and a copy attached to the dealer copy of the warranty claim.

11. The scrapping or warranty copy of the R.O. is to be 77 completely priced out for all parts and labor and retained in R.O. No. sequence.

12. The name, number and quantity of all parts used in 76 a repair must be shown on, or attached to, all copies of the R.O.

13. Customer problem analysis and system diagnosis is the 33 responsibility of qualified dealer supervisory personnel.

14. Sublet invoices must show V.I. and R.O. numbers and 76 must be cross-referenced on the R.O. The reason for the repair and all details must be shown on both documents. Attach original to scrapping copy.

15. Sublet repairs will be reimbursed at dealer's actual 70 cost, not to exceed the parts and labor allowance when performed by dealer. If the work is done for the dealer at a discount, the actual cost should be claimed. It must not be shown on a warranty claim as a dealer performed repair.

16. Towing charges will be accepted if vehicle cannot be 73,76&77 safely driven due to a failure of a warranted part and if charges are reasonable to the nearest Cadillac dealer. Invoices must show license or V.I. number, miles towed and starting point.

17. All defective material listed on R.O.'s must be 79 properly identified with a completed claim tag and must be available until scrapped by a Cadillac representative or for 30 days after credit is issused whichever is sooner.

18. "Shop comebacks" are not eligible for consideration as 73 a warranty claim.

19. A copy of the original repair order or sales slip when 77 the parts are installed or sold over the counter must be attached to the second repair order to substantiate a replacement part claim.

20. Dealers utilizing the Option A warranty labor rate plan 66 must list both hours and tenths charged on retail and warranty repair orders.

21. Under the Option A labor rate, dealers must list the 62 & 66 retail labor rates on each copy of all customer pay and warranty R.O.'s. The retail labor rate must equal the warranty labor rate approved under option A.

22. Under the option A labor rate, dealers must post either 64,65 & 66 the retail labor rate sign or the optional written estimate sign.

General Motors bulletins are intended for use by professional technicians, not a "do-it-yourselfer". They are written to inform those technicians of conditions that may occur on some vehicles, or to provide information that could assist in the proper service of a vehicle. Properly trained technicians have the equipment, tools, safety instructions and know-how to do a job properly and safely. If a condition is described, do not assume that the bulletin applies to your vehicle, or that your vehicle will have that condition. See a General Motors dealer servicing your brand of General Motors vehicle for information on whether your vehicle may benefit from the information.