GM increases powertrain warranty

DETROIT — General Motors Corp. has increased the powertrain warranty on all of its 2007 passenger vehicles in an effort to help it sell more autos by boosting its reputation for quality.

The increase to five years or 100,000 miles from the previous warranty of three years or 36,000 miles was effective Wednesday and covers 900 engine, transmission and driveline components, said Mark LaNeve, GM North America's vice president for sales, service and marketing.

The warranty is part of the company's overall strategy to sell the value of its products as opposed to a deal laden with cash incentives, LaNeve said. The automaker also is hoping that it will erase a perceived quality gap between its vehicles and those of its main Japanese rivals, he said.

LaNeve said that by both internal and external measures, such as studies by J.D. Power & Associates, GM has closed that quality gap.

"Because of deficits 20 years ago, we're living with a perceptual gap. Perception hasn't caught up to reality," he said.

The warranties have no deductibles and are transferrable, which should boost the resale value of GM vehicles. The warranties, which will be extended retroactively to any previously purchased 2007 vehicles, are accompanied by GM's roadside assistance and courtesy car programs.

GM said the powertrain warranties are better than any "full-line manufacturer" in the industry and will be in addition to the current three-year, 36,000-mile bumper-to-bumper guarantees. Buicks, Cadillacs, Hummers and Saabs currently have four-year, 50,000-mile bumper-to-bumper coverage. Also Wednesday, GM Chairman and CEO Rick Wagoner said the company is planning a flexible portfolio of cars and trucks that will change with market demand and the price of gasoline.

Speaking to reporters at the company's downtown Detroit headquarters, Wagoner said GM plans to change the mix of vehicles it offers based on gas prices ranging from $2 to $5 per gallon.

"I think the hard part is not the $2 scenario. I think the hard part is the $5 scenario or the $4.50 scenario," Wagoner said.

GM and other domestic manufacturers were caught with too many trucks and sport utility vehicles this year as the market shifted toward more fuel-efficient cars and crossovers. Wagoner said the $5-per-gallon lineup would cost more because the company would have to invest more in its plants to make the change.