An auto dealer executes an agreement on behalf of the manufacturer of the vehicle to maintain and repair a vehicle for a particular period of time which is called Auto Warranty. During the specified period, the responsibility of replace and repair of the faulty parts of the vehicle goes to the auto dealer without charging a fee to the owner. According to the US law, all user products as well as the cars and other vehicles have to be trade with a warranty. The auto dealers have to rectify any fault of the vehicle during the period of warranty. However, replacement of some costly spare parts will not take under the warranty. Similarly, replacement of spare parts and accessories damaged in an accident will be out of the auto warranty.

Two categories of warranty are available. Brand new cars hold the first one which is new car warranty. The second category is for used cars which is used car warranty. Aftermarket auto warranty is another name of used car warranty. The aftermarket auto warranty is more expensive in comparison with the new car warranty as ensuring an old car is more risky. The auto dealer offers the auto warranty including a detailed plan at the time of selling the car.