Warranties are repair options that manufacturers offer as part of their marketing strategy. It is important to note that there are no legal requirements mandating the inclusion of warranties with products. However, if a warranty is provided, it must adhere to the regulations outlined in the Magnuson-Moss Warranty Act.

Typically, warranties are short in duration, often less than a year. This is primarily due to accounting considerations. Manufacturers need to account for potential costs associated with providing warranty service when reporting sales revenue. For instance, if a manufacturer estimates that the average cost of a warranty repair is $50 for a product sold at $1,000, they must reduce their reported revenue by $50. If their projections are not accurate and they incur additional costs, they may have to report a charge-off against revenue, which can attract negative attention from financial analysts.

Publicly held companies are required to disclose these reports, allowing interested parties to track accruals and determine the actual cost of warranties borne by the manufacturer.

Extended warranties, which are sold separately, often serve as highly profitable service options. These plans have consistently yielded profit margins of 90% or higher for many years. In numerous cases, the additional warranty coverage, upgrades, or service level agreements contribute more profit to the transaction than the product sale itself. This is akin to printers being sold as loss leaders to drive sales of ink cartridges.

It is important to recognize that warranties do not necessarily reflect the durability, serviceability, or quality of a product. The primary goal for manufacturers is to generate profits. The profit motive can incentivize designers to choose the most cost-effective components that will survive the warranty period, rather than prioritizing long-term durability.

The Right to Repair movement does not aim to alter existing warranties. Instead, it seeks to empower consumers by providing them with access to post-warranty service agreements or options at competitive prices. This enables consumers to have greater control over their repair choices and fosters a more competitive repair market.