extended warranty

regor · August 7, 2004

I own a 01 silverado (4.8l, 2wd, auto). I'm coming up to the expiration of the orignial warranty. I'm pondering about buying an extended warranty. Any suggestions or comments?

Thanks

Charlie in TX · August 9, 2004

As you undoughtedly figured, there are many different opinions on E-warrenties. Mine is no better or worse than anyone elses.

No way in hell I would buy a e-warrenty. 2 ways I look at it. If I think my truck is a piece of shyt and is about to brake, I will sell it. Secondly, it (like the lottery) is a tax on people who don't know how to do math.

The insurance (warrenty) companies know exactly how much it will cost them to fix the warrentied auto. If it cost more they will find a reason to deny coverage, otherwise they will go out of business. They take that cost, add 20 to 30% and sell it to the dealer for that. The dealer adds his profit. So the $2000 you spend on the warrenty becomes $1000 availible for repairs. One in 10 autos gets a $10000 motor, the other 9 get nothing.

I have owned 6 new autos in the last 10yrs. If I bought the warrenties it would cost between $9k and $12k. So far the repairs not covered by the factory warrenty totaled about $1k. That additional $8k-$11k goes a long way to pay for any repair and piece of mind.

I am a fan of the TV show 'The Simpsons'. One show Homer discovered he had a crayon shoved in his nose putting pressure on his brain making him stupid. Long story short, at the end of the show they were soving the crayon back in. Each time they would wack the crayon Homer would say something more stupid than the last. They stopped at 'extended warrenty, how can I go wrong'.

lrymal · August 9, 2004

Another way to look at the extended warranty is that it is good insurance against catastrophic failure on a high mileage vehicle, such as motor or transmission.

On the other hand, if you had set aside $100/mo on a 5 year truck note, you will be self-insuring yourself for such a failure. And since such a failure is probably not going to happen, that will be YOUR money. In the long run, you'd be better off saving each month like this.

Sooooo, you need to cover yourself when going past warranty, either by your own savings, or by the extended warranty. Even with your warranty coming to its end, if you start saving now, you would be close to covering yourself.

Another option is a low-interest credit card that you wouldn't touch, except for emergenices.

I think I'm recommending against the warranty, provided you being saving funds or have the low-credit card. Either way, you'd have the ability to cover for catastrophic funds at a cost far cheaper than the extended warranty.

ness5575 · August 9, 2004

as charlie alluded to, it is a bit of a gamble. the warranty company is obviously in the business of making money, so they are going to charge you more for a warranty than they will need to pay out in repairs (on average).

i had a gmpp ext warranty for my truck, and it did end up paying for itself. not 1 big thing, just some nickel and dime stuff that added up. there were things on the truck that i did get fixed under warranty that I could have survived w/o having fixed - like the lights that went out in my radio on ac control unit. the ext warranty replace the whole units for free, w/o the warranty i would still have the burned out lights. not a big deal, but helps keep the truck looking and feeling newer.

also figure anytime you need a SES code read (you can try autozone, but their little computer isnt nearly as accurate as the dealerships) you are going to blow $75 just to find out what is casuing it.

i thought it was worth the money. these trucks have lots of expensive parts and lots of complicated stuff that needs the fancy dealership code reader to figure out whats wrong.

if you do buy one, get the gmpp. dont mess around with the others, who knows if they will be there when you need them! (warranty gold...)

sonjaab · August 9, 2004

These guys are right ! A ex-warranty is a crap shoot !

But if your like me and WORK the crap outta it a ex-warranty

makes a good choice !

Smoked tranny $2500, abs module $1000, Computer $1000,

and so on!

Check these guys for the lowest prices on a GMPP warranty.

http://www.gmoutlet.com

Shaners · August 10, 2004

My truck is just over 3 years old and less than 17K miles. I thought about an extended warranty, but I've decided against it, since I drive soo few miles.

Mike G · August 11, 2004

For what it's worth... The big chunk of the cost is not with the insurance company offering the warranty, it's the dealership mark-up for selling it to you