Section A – Warranty Policy Manual
A.5 REIMBURSEMENT POLICIES
A.5.2 Parts Reimbursement Policies
A.5.2.1 Part Categories
A.5.2.1.1 Outside Purchased Part
When a new Ford, remanufactured or reconditioned part is purchased from a source other than the Ford Parts Distribution Center, FAD or Ford Authorised Remanufacturer, and the cost is GREATER than if it had been purchased through the approved channels, the price difference is reimbursable if the repair qualifies as an Emergency Repair. The price difference is reimbursable at actual cost. There is no parts allowance/ mark-up on the price difference amount.
Reimbursement is as follows:
Ford (new or remanufactured) or Motorcraft part purchased from another Ford or Lincoln Dealer) for Warranty/ESP/Goodwill repair:
- Payment is made at the Dealer Price plus the applicable parts allowance or handling allowance.
- Enter the miscellaneous expense code “Other Misc” in the miscellaneous expense field and enter the price difference for the part in the amount field, if eligible.
- Parts transportation charges are not reimbursable.
- Payment is made at Actual Cost and is not to exceed the cost of the comparable Ford part (for non-Ford parts).
- Payment is made at actual cost plus the applicable parts allowance, if the cost is reasonable.
- Parts transportation charges are not reimbursable.
- Retain a copy of the outside parts purchase invoice as per the document retention period following Company notification of payment.
- Retain a printout of the applicable PANDA screen showing that the Ford part was not available (e.g., 2V VOR status) and the Parts VOR order number. These documents must be retained as per the Record Retention Period following Company notification of payment.
A.5.2.1.2 Paint Material
The materials allowance for a paint claim is calculated using the standard repair times applicable to the repair. The details are provided below for this calculation.
- The hours that are applicable for the repair are determined by the operations required. Where the repair has two or more SLTS’s applicable to it, the SLTS’s are added together. For example, Paint Bonnet BP16612 3.6 hours, Blend 13999X 1.0 Hour would total 4.6 hours.
- This figure (4.6 hours) is then multiplied by the Paint Materials Reimbursement Rate. This rate is pre-determined and is update by the Company, (refer to the FMCDealer portal). For example, if the paint type is a ‘Pearl’ and the reimbursement rate is $50.60, then the following calculation for materials is applicable. 4.6 hours X $50.60 = $ 232.76. Therefore, in this example the Dealer may claim $232.76 for materials. The total amount payable for materials is applicable to both In-Dealership repairs and Sublet repairs. For Sublet repairs the Dealer must apply the same methodology to assess the amount claimable (refer to Sublet Repairs)
- 9.4 percent:
- Dealer price is the price listed in the Company Parts and Accessories Price List (Excludes SDS Parts) for parts purchased from the Company.
- Actual cost is the amount charged by an outside source for parts purchased under certain conditions, refer to "A.5.2.1.14 Sublet Repair Reimbursement".
- Exchange price is the amount charged for the part (or assembly) less the core amount allowed for turning in the replaced part.
- Net Amount the amount allowed for certain parts that are not eligible for the applicable parts allowance. In the case of batteries, a factor is included in the net price for the parts allowance.
- Outright price includes a core allowance. The core allowance is the difference between the outright price and the exchange price.
- For Ford parts purchased from a source other than the Ford Parts Distribution Center, payment is normally made at the Dealer Price plus the applicable parts allowance or at the Exchange Price plus the applicable parts allowance (For exceptions refer to Emergency Repairs.
- For non-Ford parts purchased from an outside source (e.g., parts used by a specialty shop), payment is normally made at Actual Cost plus the applicable parts allowance or at the Exchange Price plus the applicable parts allowance. In both cases, the maximum payment is limited to the Dealer Price of the comparable Ford part plus the applicable parts allowance.
- Payment for non-Ford parts (when comparable Ford parts are out of stock nationally from the Company) is based on actual cost, not to exceed the Dealer Price of the comparable Ford part, plus the applicable parts allowance.
- Payment for non-Ford parts (when comparable Ford parts are not offered by the Company) is based on actual cost plus the applicable parts allowance, if the cost is reasonable.
A.5.2.1.3 Parts Transportation Charges
Critical parts handling charges to Dealers by Ford are not reimbursable.
A.5.2.1.4 Parts Reimbursement
Parts Reimbursement is the parts cost price from the Company based on the Dealer’s parts reimbursement rate.
Payment for Ford parts is based on the Dealer or Exchange Price, in effect on the date of repair, plus a parts allowance, or at “Net,” whichever is applicable. Following are terms that apply to Ford and non-Ford parts:
Parts Allowance:Unless otherwise specified by Ford in writing, the parts allowance on Ford-paid repairs is:
A.5.2.1.5 Shop Supplies
Normal shop supplies such as adhesives, lubricants (tubes or sprays), solvents/cleaners, rust inhibitors, thread lock, rags, film, electrical tape, etc., are not reimbursable separately unless specifically stipulated as being required in the repair procedure for emissions or safety recalls, customer satisfaction programs or TSBs that their cost is reimbursable. Refer to A.3.13.76 Shop Supplies for more detail with examples and exceptions
A.5.2.1.6 Standard Parts
IIn many instances standard parts can only be ordered in a package with multiple pieces. Reimbursement for standard parts packaged in this manner is based on the actual quantity used to complete a repair. For example: If a technician completes an A/C repair using three (3) “O” rings from an “O” ring pack (standard part supplied in package contains six (6) identical “O” rings) the correct quantity that should be claimed is three (3).
A.5.2.1.7 Sublet Repair (Parts Reimbursement)
Sublet repairs must be completed using Ford parts. If Ford parts are not available:
If an outside repair source, such as a Body Repairer / Panel Shop, installs a new Ford authorized component properly on a Ford vehicle still under warranty, using professional workmanship, Ford’s new vehicle warranty against defects in factory workmanship and material applies. If repairs made by an outside repair source or installation of non-Ford parts cause or contribute to the failure of a Ford component, the resulting cost is not covered by Ford’s new vehicle warranty.
IMPORTANT: Sublet parts (OSP) are not eligible for parts allowance when listed on a warranty repair form.
A.5.2.1.8 Tyres / Tires
The warranty on tyres and tubes fitted to Ford products is underwritten by the tyre manufacturers. The warranty policies of the various tyre companies, who supply Ford production requirements, are uniform and when evidence of a claim against a tyre manufacturer, under warranty exists, it should be taken up with the nearest authorised representative of the manufacturer.
The tyre manufacturer will review the claim and, if approved, provide coverage on a pro-rata basis. In the event of a tyre manufacturer not fulfilling their warranty obligations, contact Warranty Operations Helpdesk.
Tyres failing as a result of normal wear and tear and/or external influences are not covered by warranty.
A.5.2.1.9 Transportation Charges (Parts recalled to Warranty and Return Parts Evaluation Center (WARPEC))
Non-Reimbursable: All parts from Company paid repairs that are to be returned to the Warranty and Return Parts Evaluation Center (WARPEC), component suppliers or other Company-nominated locations will be returned via the established WARPEC return process.
No freight charges should be incurred by Dealers for the return of these parts. Under NO circumstances should parts be returned directly to the WARPEC unless specifically requested by a representative of the Company in writing. Parts returned directly will not be reimbursed for the freight charges incurred by the Dealer.