Warranty prices to rise

Warranties offered on bikes could rocket in cost because of a new ruling which makes them subject to controls by the pin-striped suits of the Financial Services Authority.

The FSA usually regulates insurance and the like. The Government has decided that warranties lasting up to 24 months are a form of insurance.

The legislation comes into effect on January 15, 2005 and, according to the Daily Telegraph, BMW is warning it could add 25 per cent to the cost of warranties offered with bikes. Who ends up picking up the tab that remains unclear.

BMW GB’s director Jim O’Donnell is quoted in the Telegraph as saying the firm has already spent £300,000 working out how the legislation will impact and is now forking out another £5000 per dealer to train staff in the new rules.

France, Germany and Ireland have decided the regulations do not apply to car and bike dealers.