Competition for your tool-buying dollar has become more intense than ever. In a retail atmosphere where profit margins are razor-thin, shelves are loaded with a multitude of high-quality tools, and educated consumers are less likely to base their purchasing decisions on tool color alone, the latest tool-selling battlefield has become warranty coverage. This has led many manufacturers to risk the potential financial costs of warranted repairs and product replacements to attract and keep customers. And those that are not eager to expand their coverage might soon be influenced to follow suit if such foot-dragging is perceived by buyers as a lack of confidence in their tools.

Focusing on power tools (both corded and cordless) and nailers, we took a look at the enhanced offerings being made by tool companies to determine what has really changed for the customer amid all the hype. In most cases, little additional benefit will be realized by the tool buyer from the new warranties themselves, but new service agreements can add appreciable value.

Our goal here is to equip you with the information you'll need to decide if a warranty brings value to your purchase, and we have intentionally left warranty coverage offered by specific manufacturers unidentified.

Warranties Defined

There are two basic types of warranties applied to tools and other goods: implied and express.

Implied warranties are provided for by state law and include unwritten coverage of both the warranty of merchantability and the warranty of fitness for a particular purpose. These intuitive clauses are based on the legal principle of "fair value for money spent" and simply mean that a product should be good enough to sell and should work like it is intended to. Consumers' rights to such coverage cannot be superseded by more specific express warranties; however, an implied warranty's term can be limited by an express warranty if it is of "reasonable" duration. Also, in some states it is possible for goods to be sold with the implied warranties disavowed; beware of phrases like "as is" and "with all faults."

Express warranties are governed by federal law and are expressed, or written out, with specific promises made by the manufacturer about the remedies they offer if the product is found to be defective. By law, these warranties must be designated as either full or limited and live up to the requirements of each.

Full warranties, (not to be confused with lifetime warranties), are restrictive to the manufacturer and therefore very rare. When we discuss tool warranties, we are talking about limited warranties almost without exception. Such an express limited warranty must explicitly state its terms and conditions, including what is covered and for how long, remedies and their fulfillment, and how state laws might affect customer rights under the warranty. This final item requires the following disclosure: "This warranty gives you specific legal rights, and you may also have other rights which vary from state to state." In addition, if a limited warranty seeks to restrict implied warranty terms or deny liability, similar disclaimers are required. Curiously, even though the use of these statements is legally mandated by the Federal Trade Commission, many of the warranties we looked at omitted the necessary boilerplate.

New Trends in Coverage

In 1975, Congress passed the Magnuson-Moss Warranty Act to make warranty terms available to the consumer before the sale and thus enabling the modern, competitive use of express warranties as marketing tools by manufacturers and retailers. Today, tool buyers are experiencing an upswing of warranty awareness that is unprecedented in scale; never in recent history has the warranty of a tool been so visible, figuring prominently in displays, advertising, and packaging.

From one-year coverage, the standard of just a few years ago, to three-, five-, and seven-year and now lifetime warranties, where will it end? Interviews within the industry lead us to believe that we are riding out the apex of a marketing fad that will settle down in a year or so, but for now, here's how this trend affects tool buyers.

Warranty Term Escalation

The increases in the duration of limited warranty periods typically only cover defects in materials and workmanship. Adding years to this coverage is of questionable value because most true manufacturer's defects are found very early in a tool's service life. Short of a recall situation, it is probably a rare case when an imperfect material or assembly just begins to cause a noticeable problem five years down the road. And by then, depending on the tool, it could already be close to the end of its useful life anyway. One nailer manufacturer told us that only about 1 percent of their tools ever make it in for a warranted repair. This inflation of warranted years seems to be mostly a numbers game without overwhelming tangible benefits. Remember, a warranty is only a contract. A five-year warranty does not guarantee that a tool will last that long, it only says what the manufacturer will do for you if it doesn't.