The costs of the program should be mitigated by the used car certification process, which ensures used cars sold through the GM Certified and Saturn Certified dealers meet certain standards. The company hopes that the new warranty will help expand sales of the used cars while at the same time improving residual values.
If the program does boost residual values, it could help take some of the strain off the company's ailing GMAC leasing division, which has faced major losses from the plummeting residual values of its lease fleet thanks to the weak economy, high oil prices and shifting consumer preference towards smaller, more fuel-efficient and typically foreign-make vehicles.
Whatever the outcome for GM, however, the warranties look to be a good deal for consumers, as they carry no deductible and are fully transferrable.
