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03-09-2013, 04:26 PM | #1 |
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Cost of extended warranty goes up if you buy it later?
Today I was car shopping with my sister.
Of course at the end the business guy was trying to sell her the extended warranty, which she should probably get but really can't afford, at least not now. I told her not to sweat it she can decide anytime before the standard factory warranty is up. The guy said yeah but the cost goes up the longer you wait because the car will be "more used" in his words. I said thats insane because the extended warranty does start until (in her case) the factory warranty runs out at 36,001 miles so it doesn't matter how used the car is when you buy it. Anyone ever heard of this?
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03-09-2013, 04:38 PM | #2 |
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Yes, it's called the time value of money. You basically loan them money upfront, which reduces the price you pay today vs. tomorrow. If interested in an extended warranty, I'd wait. Money is cheap today so the discount isn't huge and what happens if you wreck the car before the extended warranty takes affect? Do you get cashed out?
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03-10-2013, 12:19 AM | #3 |
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This is a Buick Enclave we're talking about so $2500 might not be a bad investment. I just don't think GM makes good vehicles.
But with a GM dealer on every corner maybe she can get a better deal somewhere else.
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03-10-2013, 12:07 PM | #4 | |
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I would suggest buying GMPP extended warranty directly from GM if the plan is to keep it outside of bad warranty, steering repairs and front cover repairs are both quite expensive. |
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03-11-2013, 07:37 AM | #5 |
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Oh trust me I tried to talk her out of the Enclave but she would have none of it.
In fairness though she has 4 year old triplets so her choice of vehicles is limited. I think she should get the extended warranty but she still has 22k miles to decide and with a GM dealer on every corner I think she should get several quotes on it.
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03-13-2013, 04:57 PM | #6 |
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Never ever... ever never... buy an extended warranty from any manufacturer. It's a waste of money. $2500 is a lot a money to gamble on what might.. go wrong. Don't part with your money. If the car is that unreliable don't buy it. If your sis is set on buying it... well .. she was warned.
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03-13-2013, 06:48 PM | #7 |
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Depends...I do it but depends on the car and any historical problems. She might be better off putting that money in her bank account and save it for auto repairs. I tend to buy cars that are 1-3 yrs old since autos are a terrible investment. I'd rather buy stock or pump more money into my portfolio. I mainly do it b/c you never know when or if you have issues with the piston rings, pistons, or cylinder walls. Keep in mind, only 90% of auto parts are guaranteed to meet full life. I used to work for a company that supplied parts to the auto industry. Do the math, how many parts are in a car?, so the probability is pretty high that something can go wrong either in-or-out of warranty A good example is the Acura MDX, a very reliable brand. Honda is aware of problems with their piston rings and cylinder walls but refuses to do anything about it. Some have experienced excessive oil consumption while under warranty so no issues, but others have experienced this outside of the warranty so they face a huge repair bill if the problem is catastrophic. We own an MDX and luckily we are only faced with excessive oil consumption only so I end up changing/adding my oil on a more frequent basis.
Here is a site that covers all complaints, recalls, and TSBs for all cars. Just a good reference if your sister wants to investigate further: http://www.safercar.gov/
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03-14-2013, 08:41 AM | #8 |
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Yeah my debate wasn't about whether or not to get the warranty, as that will be up to her. In an effort to keep payments low she financed for 6 years and can't really afford big repairs (triplets will make you poor) so I think before the 36k is up she should get it.
She stuck with this thing for 6 more years, she can't afford big repair bills and since this is a Buick we're talking about you KNOW it will need repairs. So just spening $2000-2500 for a long factory warranty will work for her I think. Had she listened to me and bought a Honda Oddessy or Totyota Highlander I would have a different opinion.
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03-14-2013, 11:25 AM | #9 |
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Still a bad investment. That's $2,500 !!! out the window on a gamble that she will incurr problems that accumulate beyond that figure.
I would think your sis would need the money now, with her children. And not gamble it away on a chance Auto warranty. Good luck. |
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03-14-2013, 01:46 PM | #10 | |
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03-14-2013, 01:49 PM | #11 |
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I think the key word in your response is "I work for GM". Buying ANY extended warranty is wasting money and foolish.
I don't like taking $2,500 gambles on a "maybe". lol I'll bet GM makes it's highest profit margin selling these warranties than any other product they sell. They sell them on scare tactics during the buying process. Frankly, GM should be charged with robbery for trying to push such a useless product on the public. If GM automobiles are prone to failure as you describe, then that company has much bigger problems .. like trying to convice people to buy their cars in the first place. This is such an easy decision that I'm surprised anyone would think otherwise. $2,500 USD !! is an incredible amount of money to invest on such a product. GM is stealing from the public selling these high dollar warranties. Last edited by PA135i; 03-14-2013 at 02:41 PM.. |
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03-14-2013, 02:47 PM | #12 | |
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03-14-2013, 03:01 PM | #13 |
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I work in the industry as well. Agree with 08LMB. If you are going to get an extended warranty, get the OEM one. The aftermarket warranties are nothing but nightmares. And be careful, I know of a couple people that bought extended warranties from the dealer, and it turns out they were aftermarket. The $100 the dealer saved them by offering the aftermarket instead, cost them thousands when a repair was declined that the OEM warranty would have covered no questions asked.
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03-14-2013, 03:02 PM | #14 |
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My previous post said it all.
I find it hard to believe that any reasonable person would think spending $2,500 this way would be a good investment. |
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03-14-2013, 03:06 PM | #15 |
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I don't intend to debate the value of an extended warranty.
I was just interested if the cost of extended warranties went up as you got closer to 36k miles, which made no sense to me at all.
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03-14-2013, 03:06 PM | #16 | |
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I am very glad my wife bought the extended warranty on her Civic. After the bumper to bumper warranty expired her CD player got a CD jammed inside of it, would have cost $1200 to repair. Then after the powertrain warranty expired, her 3rd gear syncro started to get notchy, there is a service bulletin to repair the 3rd gear with a new updated part, but it would only be done if it was under the 5yr/100k warranty. Luckily the extended warranty paid for a trans "rebuild" that included the updated 3rd gear. Would have been a $4000 repair. Those two repairs alone would have cost 50% more than what she paid for the extended warranty. $2500 does not fix much on a car these days....... And to answer your question about the price now vs later, Pigfarmer has it right in the first reply to your question.... Last edited by MightyMouseTech; 03-14-2013 at 03:19 PM.. |
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03-14-2013, 03:20 PM | #17 | |
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I think it was like an additional 4 years and 48k or 60k miles. I didn't think it was that bad either. Hell with a GM product I can virtually guarantee spending tthat much over 7 years. At least it doesn't have nav or DVD system.
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03-14-2013, 03:44 PM | #18 |
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Man and I thought GM products were pretty robust and reliable but bland.
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03-15-2013, 07:35 AM | #19 | |
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Thing is even this 2012 higher-leve GM ptoduct feels dated. The radio/climate control system uses these cheesy LED displays right out of the 80's. They work fine but make the whole car feel dated and certainly not a premium feel. Hell our 2009 Highlander (without nav!) has a nice modener looking LCD screen for climate. Same with the cheap-feeling butons and knobs. It really feels like it came from a 1992 Cavelier. Not sure if this is reflective of all the mechanical components not so visible but I have zero faith in GM and while I'm sure the 12's are better than the '82's and '92's, actually sitting in one makes me think they still have a ways to go.
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03-15-2013, 07:42 AM | #20 | ||
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03-15-2013, 08:17 AM | #21 |
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03-15-2013, 09:47 AM | #22 |
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The problem with automakers is that irts very hard to change perceptions quickly.
If you get a bad reputation (like GM and Chrysler) it takes years of making MUCH better vehicles before people will give you the benefit of the doubt. Maybe GM & Chrysler are better now but a car is a pretty big investment and I'm not willing to give them the benefit of the doubt, at least not yet. Ford I think it further along than the other guys, which is why I tried to push her towards the new Explorer.
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