Under US law, all consumer products have to carry warranty, which guarantees replacement of a spare part if found faulty within a specified period of time from the date of its sale. The period is called the warranty period. The warranty is issued to all categories of consumer products, including cars and autos. The warranty issued to cars is called automobile warranty.

The auto warranty is issued on the basis of time as well as distance covered by the car. For instance, the warranty will be in place for up to two or three years from the date of the sale. The warranty will also be in place up to 30,000 miles covered by the vehicle. There is a third basis, which is an combination of time and distance. It means the warranty period will be in place till whichever of the two expires first.

There are two types of auto warranty. They are new car warranty and used car warranty. The new car warranty is issued to brand new cars while the used car warranty is issued to pre-owned cars. The used car warranty is also called as an aftermarket auto warranty. The used car warranty is costlier when compared to new car warranty.