AMC Invented The Bumper To Bumper Warranty In The '70s And Threw In A Free Loaner Car

Many of the consumer protections we take for granted today were not guaranteed in the past. Legal action has resulted in laws to protect consumers on a state-by-state and on a federal basis, including lemon laws that protect consumers from pricey repairs on newly purchased cars. While there are no laws mandating automakers to provide a warranty on the new cars they sell, it has become an industry standard. And it all started with one of the most influential, yet often forgotten, U.S. automakers, the American Motors Corporation (AMC).

The world has AMC to thank for the popularization of the civilian Jeep, the crossover SUV, and the domestic subcompact car, and also the bumper-to-bumper warranty with loaner car and expense reimbursement included. Gerald Meyers, who served AMC in several positions including purchasing manager, vice president of product engineering, and eventually CEO, introduced the car industry's first 12-month or 12,000-mile bumper-to-bumper warranty with loaner car and expense reimbursement, the AMC Buyer Protection Plan, in 1972.

AMC's Buyer Protection Plan warranty was advertised to cover everything on the car except the tires, including spark plugs, brake linings, and even light bulbs. It also included a loaner car if repairs couldn't be completed in one day as promised, and it even provided AMC owners who were more than 100 miles away from home with reimbursement for lodging or meals. That's even more than today's warranties cover, though modern warranties tend to last longer than 12 months. Before AMC's warranty, other automakers offered 30-day or 90-day warranties on their cars, and though some offered even longer ones, they were more restrictive than AMC's bumper-to-bumper warranty.

Strong warranties rapidly became a strong selling point for buyers, and for burgeoning carmakers as well. The first Korean car brand to enter the U.S. market, Hyundai, offered a 10-year, 100,000-mile power train warranty on its 1999 models as a way to lure cost-conscious buyers into its showrooms despite the brand's lack of history. Hyundai and Kia still offer this exceptional warranty on new vehicles despite their improved reputation. As a whole, the automotive industry has AMC to thank for a lot of things, including the implementation of comprehensive warranties with perks that actually help make owners' lives easier when things go wrong.