Optimizing Bus Warranty (2014)

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40 SyntheSiS QueStionnaire optimizing BuS Warranty Note: This form is designed to be used electronically. Simply place the cursor inside the shaded box and either type in your response or left-click within the appropriate Yes/No answer box. Date: Transit Agency Name: Respondent Information: Name: Telephone: E-mail: appenDiX B Survey Questionnaire Purpose of this Survey: Warranty is an important but often overlooked transit bus function. Although manufacturers incorporate warranty costs into every new bus and component sold, some agencies fail to seek reimbursement for warranty repairs because their process is cumbersome and often considered a nuisance. Others, however, have effective procedures in place to optimize the warranty function and obtain full warranty reimbursement. This questionnaire is intended to obtain in-depth information to provide a state-of-the-practice look at how agencies of different sizes manage bus warranty operations. The report produced from this study will focus on innovative and effective procedures used by agencies to establish warranty specifications, track warranty coverage periods, file claims, receive reimbursement, train warranty personnel, and settle vendor disputes. The information will also be used to examine the pros and cons of in-house versus vendor repairs, and the warranty implications of add-on equipment and using aftermarket parts. The collective information gathered through this synthesis will help improve warranty operations. Feel free to use additional pages and attach documents. Instructions for returning the survey by February 7 are found on the last page. Thank you for your participation! Transit System Characteristics 1. How many total buses are in your fleet? Fleet breakdown by type: 40 foot and larger Total Number 30–39 foot Total Number Under 30-foot Total Number Comments: Warranty Personnel 2. How many people at your agency are involved with administering warranty such as tracking warranty periods, processing claims, seeking reimbursement, etc.? Number of personnel working full-time at administering warranty Number of personnel working part-time at administering warranty 2a. If you have personnel that work part-time at administering warranty, what other agency activities are they engaged in? (Choose all that apply.)  Clerical/admin.  Parts department  Maintenance & repair  Other (specify): Comments:

41 3. Are warranty administrative personnel trained for their job? Yes  No  3a. If yes, who provides the warranty training? (Choose all that apply.)  Agency  Manufacturer/vendor  Other (specify): 3b. How much administrative warranty training is provided per person? (Choose one)  Less than an hour per employee  More than an hour per employee 3c. If more than an hour per year, approximately how many administrative warranty training hours are provided per employee? 3d. Do you have specification language requiring manufacturers/vendors to provide administrative warranty training? Yes  No  If yes, would you be willing to share those requirements? Yes  No  Comments: Warranty Specifications 4. Do your bus procurement specifications include a section dedicated to warranty? (Note: replacement components will be addressed later.) Yes  No  5. Below are excerpts from APTA’s Standard Bus Procurement Guidelines (White Book) for heavy-duty buses regarding warranty period recommendations for 12-year, heavy-duty buses. Indicate if you use those recommendations for the major items listed below or if you use another warranty period. Note: Chose one response for each category. Note: Only complete for heavy-duty, 12-year buses. 5a. Complete Bus  1 year/50K miles, or  Other: Years Miles Comments: 5b. Body & Chassis (including structural elements of the suspension and engine cradle but excluding primary load carrying members)  3 years/150K miles, or  Other: Years Miles Comments: 5c. Primary load carrying members of Body & Chassis  12 years/500K miles, or  Other: Years Miles Comments: 5d-1. Propulsion (Diesel) Engine:  2 years/100K miles, or  5 years/300K miles, or  Other: Years Miles Transmission:  2 years/100K miles, or  5 years/300K miles, or  Other: Years Miles Differential/Axles:  2 years/100K miles, or  5 years/300K miles, or  Other: Years Miles Comments:

42 5d-2. Propulsion (CNG if applicable) Engine:  2 years/100K miles, or  5 years/300K miles, or  Other: Years Miles Transmission:  2 years/100K miles, or  5 years/300K miles, or  Other: Years Miles Differential/Axles:  2 years/100K miles, or  5 years/300K miles, or  Other: Years Miles Comments: 5d-3. Propulsion (Hybrid if applicable) Engine:  2 years/100K miles, or  5 years/300K miles, or  Other: Years Miles Drive Motors/Generators:  2 years/100K miles, or  5 years/300K miles, or  Other: Years Miles Differential/Axles:  2 years/100K miles, or  5 years/300K miles, or  Other: Years Miles Comments: 5e. Brake system (excluding friction surfaces)  2 years/100K miles, or  Other: Years Miles 5f. Destination signs  2 years/100K miles, or  Other: Years Miles 5g. AC unit and compressor (excluding floor heaters and front defroster)  2 years/100K miles, or  Other: Years Miles 5h. Door systems  2 years/100K miles, or  Other: Years Miles 5i. Air compressor  2 years/100K miles, or  Other: Years Miles 5j. Wheelchair lift and ramp system (mechanical only)  2 years/100K miles, or  Other: Years Miles 5k. Starter  2 years/100K miles, or  Other: Years Miles 5l. Alternator: excluding drive system  2 years/100K miles, or  Other: Years Miles 5m. Fire suppression:  2 years/100K miles, or  Other: Years Miles Comments: 6. Do your warranty specifications for new buses include any unique or innovative warranty terms and conditions? Yes  No  6a. If Yes, please describe them: 6b. Are you willing to make your new bus warranty specifications available to others? Yes  No 

43 7. Regarding major drivetrain components purchased separately (replacement parts) for use in 12-year, heavy-duty buses, please indicate your warranty periods for: Engines New: Years Miles Engines Rebuilt: Years Miles Transmissions New: Years Miles Transmissions Rebuilt: Years Miles Differentials/Axles New: Years Miles Differentials/Axles Rebuilt: Years Miles Other (specify): Years Miles Other (specify): Years Miles Comments: 8. Regarding other replacement parts purchased separately, indicate your warranty coverage requirements only if they are beyond the traditional one-year period. Item (specify): Years Miles Item (specify): Years Miles Item (specify): Years Miles Item (specify): Years Miles Warranty Repairs 9. Describe your agency’s approach to making repairs during the warranty period. (Choose one)  We use our own mechanics to make all warranty repairs  We use vendors to make all warranty repairs  We make some warranty repairs and call in vendors to make others 9a. What determines whether the agency makes repairs or whether vendors make them. (Check all that apply.)  Labor agreement with union  Procurement specification  Depends on nature of repair  Other (specify): Answer questions 10–14 only if vendors make warranty repairs. 10. Do vendors make repairs at your facility or are buses/components sent off property for repairs? (Choose one)  All vendor warranty repairs are done on our property  All vendor warranty repairs are done off-site  Combination of on-site/off-site Comments: 11. Identify those bus areas where vendors make warranty repairs. (Choose all that apply.)  Engines  Transmissions  Differentials and axles  Hybrid drives and other major hybrid components  Air conditioning system  Destination signs  Camera systems  Fire suppression system  Other (specify):  Other (specify):  Other (specify): Comments:

44 12. When vendors make repairs, do you use it as a learning opportunity for your own mechanics so they gain experience? (Choose best response.)  Never  Occasionally when time permits  Frequently (more than 50% of the time)  We have a formal program where the vendor is required to work alongside one or more of our mechanics when warranty repairs are made Comments: 13. With vendors doing some or all warranty repairs, do you feel that your mechanics are adequately prepared to take over when the warranty period is over? (Choose best response.)  Yes, without question  Marginally  No, not at all Comments: 14. Once the warranty period is over, do you find yourself paying the same vendors to make repairs? Yes  No  14a. If yes, are you paying for the repairs because: (Choose best response.)  Mechanics are not trained or qualified to make the repairs  We don’t have the time  All of the above Innovative Methods for Warranty Repairs 15. List any innovative and efficient methods your agency uses to optimize warranty repairs. Filing Warranty Claims 16. Do you file warranty claims manually or electronically? (Choose one)  Manually (pen/paper)  Electronically (via Internet)  Other (specify): Comments: 17. Are claims submitted to the bus manufacturer or the vendor of the particular subsystem component? (Choose best response.)  All claims submitted through the bus manufacturer  Some through the bus manufacturer, others through subsystem vendors Comments: 18. When claims are submitted directly to subsystem vendors; do you inform the bus manufacturer? (Choose best response.)  Yes, always  Sometimes  Never  Not applicable, all claims go through the bus manufacturer 19. Are there times when a vendor is called in to make a warranty claim and no formal claim is submitted? (Choose one)  Yes  No  Not applicable (we make all our warranty repairs) Comments:

45 20. Are there times when you make a repair covered under warranty and don’t submit a warranty claim for it? Yes  No  20a. If yes, state the reason(s) for not filing claims. (Check all that apply.)  Effort to submit claim is not worth the reimbursement  The warranty filing process is too cumbersome  We don’t have the time or resources to file all claims  Sometime we forget to file claims  Other (specify): Comments: 20b. If yes, what would help to file more clams?  More agency staff  A more streamlined filing process by the vendors  A more streamlined process by our own agency  Other (specify): 21. Do you have a standardized warranty claim form you make all vendors use?  Yes, we have a standardized form  No, we use the claim form provided by each vendor Comments: 22. Would you favor the industry adopting a standardized warranty claim form and process for filing claims? Yes  No  Comments: 22a. If yes, should it be made part of the APTA Guideline? Yes  No  Comments: 23. How is warranty labor allocated? (Choose best response.)  We submit the actual labor time used to make the warranty repair  We use flat-rate times provided by the manufacturer  We use a combination of the two Comments: 23a. If manufacturer flat-rate times are used, approximately how many of your total warranty claims filed are based on those times?  Less than 50% of all claims filed  More than 50% of all claims filed  We don’t use flat-rate times Comments: 23b. Is shop overhead reflected in your labor and parts cost? Yes  No  23c. Which labor rate do you charge for warranty? (Choose one)  A base labor rate of per hour  A fully loaded labor rate of per hour 23d. How are parts costs allocated? (Choose one)  We charge the actual price we pay for the part  We mark-up our parts 23e. If parts are marked-up, what is the percentage of increase? % 23f. Do you charge separately for shop material costs such as haz-mat fees, etc. Yes  No  23g. Do you charge separately for troubleshooting and diagnostic time? Yes  No 

46 23h. Regarding warranty repairs that require the bus to be towed back to the shop: (Check all that apply.)  We charge the flat-rate fee established by the vendor  We charge based on per-mile costs established by the agency  We pass along costs charged to us by the towing company  We mark-up towing company charges by %  Other (specify): Comments: Innovative Methods for Filing Warranty Claims 24. List any innovative and efficient methods your agency uses or you would recommend to optimize the filing of warranty claims. Warranty Reimbursement 25. In what form are warranty payments made? (Choose one)  Checks  Parts credit  Combination of the two  Other (specify): Comments: 26. Which department receives the warranty reimbursements?  Maintenance department  Goes to general agency fund  Other (specify): Comments: 27. If you were to add up the amount of warranty monies requested through all claims submitted, approximately how much of that money/credit is actually reimbursed by the vendors?  80–100%  50–80%  Less than 50% Comments: Innovative Warranty Reimbursement Methods 28. List any innovative and efficient methods your agency uses or you would recommend to optimize reimbursement of warranty claims. Warranty Tracking 29. How do you track the warranty periods of new buses?  Manually  Electronically  Combination of both Comments: 30. Do you use the same method to track replacement parts and components bought outside the new bus procurement? Yes  No  30a. If no, how do you track parts and components bought outside the new bus procurement? Comments:

47 31. Does your tracking system issue periodic reports showing buses and components covered under warranty (warranty start and end dates/mileages)? Yes  No  Comments: 32. After a work order/repair order is closed out, describe how you determine if repairs are covered under warranty? 33. Do you have a quick and efficient way to determine if repairs are covered under warranty? Yes  No  33a. If yes, describe them: 34. Does your tracking system have a way of alerting you when the warranty period of a bus or component is about to expire? Yes  No  Comments: 35. How would you best characterize your agency’s tracking of warranty coverage periods: (Choose best response.)  We have an excellent process for tracking warranty coverage periods and identifying warranty repairs  We have a good process that could use some improvement  We need to improve the way we track warranty coverage periods and identify warranty repairs Comments: 35a. If you have an excellent tracking process is it an agency-developed system or purchased?  Agency developed  Purchased Name: 36. Does your warranty tracking system monitor outstanding claims that have not yet been paid?  Yes, our tracking system issues periodic reports of outstanding claims  No, we need to manually check to see if claims are outstanding Comments: 37. When you make your own warranty repairs, do you keep a history of that work? Yes  No  Comments: 37a. If yes, is that history used for determining fleet defects? Yes  No  Comments: 38. When vendors make warranty repairs, do you keep a history of that work? (Choose best response.)  Yes, we insist on a complete report of the repair including the fault, and labor and parts used to facilitate the repair  Yes, but the repair data they give us is limited  Not applicable, we do our own warranty repairs Comments: 38a. If yes, is that history used for determining fleet defects? Yes  No  Comments:

48 Specific Vendor Topics Note: Although you can mention vendor names if necessary to answer the questions below, they will not be used in the report. 39. Do any vendors require you to undergo training before warranty claims can be submitted? (Choose all that apply.)  Mechanics must take prerequisite training before making warranty repairs  Administrative personnel must take prerequisite training before submitting claims  Other (specify): 39a. If mechanics are required to take prerequisite training before making warranty repairs, specify the training subjects (engines, brakes, etc.). 40. Overall, what percentage of warranty repair parts do you return or hold for a vendor rep to inspect before reimbursement is made?  10% or less  10% to 30%  30% to 50%  More than 50% Comments: 41. Identify any other special warranty requirements insisted by your vendors. 42. Overall, how many warranty claims submitted are completely rejected by vendors?  10% or less  10% to 30%  30% to 50%  More than 50% Comments: 43. Overall, how many warranty claims are partially rejected by vendors (reduction of labor and/or parts amounts)?  10% or less  10% to 30%  30% to 50%  More than 50% Comments: 44. What are the top three reasons given by vendors for rejecting or reducing claim amounts? 1. 2. 3. 45. When making warranty repairs, are you required to purchase replacement parts from the vendor providing the warranty?  Yes  No  Depends on the part Comments: 46. When making warranty repairs, are you required to purchase OEM replacement parts or those approved by the OEM?  Yes  No  Depends on the part Comments:

49 47. Using aftermarket parts or adding systems to buses after they’ve been manufactured can void the original warranty. 47a. Have you ever had a claim rejected because you used aftermarket parts—replacement parts not manufactured or approved by the OEM? Yes  No  If yes, list replacement aftermarket parts that voided warranty 1. 2. 3. If yes, what were the reasons given for why using replacement aftermarket parts voided the warranty? 47b. Have you ever had a claim rejected because you added systems such as cameras, AVL, fareboxes, annunciators, etc. and those systems affected the warranty of standard bus items? Yes  No  If yes, list the add-on systems and equipment that voided warranty of standard bus items. 1. 2. 3. If yes, what were the reasons given for why adding on systems/equipment voided warranty of standard bus items? 47c. Have you been successful in overturning the vendor’s original refusal to honor warranty claims? Yes  No  47d. How did you convince the vendor to honor the original warranty? Fleet Defects The APTA Procurement Guidelines define fleet defect as: “Cumulative failures of twenty-five (25) percent of the same components in the same or similar application in a minimum fleet size of twelve (12) or more buses where such items are covered by warranty. . . . . When a Fleet Defect is declared, the remaining warranty on that item/component stops. The warranty period does not restart until the Fleet Defect is corrected . . . After correcting the Defect, the Agency and the Contractor shall mutually agree to and the Contractor shall promptly undertake and complete a work program reasonably designed to prevent the occurrence of the same Defect in all other buses and spare parts purchased under this Contract . . . The Contractor shall update, as necessary, technical support information (parts, service, and operator’s manuals) due to changes resulting from warranty repairs.” 48. Were you aware of all aspects of this definition before reading it here? Yes  No  48a. If no, which aspects were you unaware of? 49. About how many fleet defects have you declared in the past 5 years? 49a. List the nature of the fleet defects: 1. 2. 3. 50. Have you had any cases where you felt you had a legitimate fleet defect but did not declare because it could not be substantiated? Yes  No  50a. If yes, why couldn’t it be substantiated? (Choose all that apply.)  Lack of proper documentation  Failures fell short of 25% fleet requirement  Other (specify): 51. Have you had cases where you declared a fleet defect but the bus manufacturer failed to recognize it as such? Yes  No  51a. If yes, list the nature of the disputed fleet defects: 1. 2. 3.

50 52. Have you had any fleet defects where the bus manufacturer failed to update technical support information (parts, service, and operator’s manuals) due to changes resulting from warranty repairs? Yes  No  Comments: Warranty Violations & Disputes 53. About how many of your claims involve violations and/or disputes with vendors?  10% or less  10% to 30%  30% to 50%  More than 50% Comments: 54. What procedures do you find effective in resolving warranty violations and disputes? Vendors That Go Out of Business 55. Have you had a case where a vendor went out of business during the warranty period? Yes  No  55a. If yes, was it the manufacturer of a complete vehicle or part/component?  Complete vehicle  Part/component 55b. If yes, what was the outcome when equipment failed during the warranty? General Comments 56. Please add anything else regarding warranty and ways to optimize it that were not already covered: 57. What advice would you give your peers regarding ways to optimize bus warranty? 1. 2. 3. Please return the completed version and any attachments via e-mail to John by February 7, 2013, at JohnJSchiavone@cs.com. Material can also be sent to him at (please contact him before mailing): John Schiavone 32 State Street Guilford, CT 06437 If you have any questions on the survey or the project, please do not hesitate to call John at 203-453-2728. Thank you very much for your participation in this important project!