Warranty on a used car ... worth it?

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verneer's Blog

August 30 2010

Warranty on a used car ... worth it?

Katy and I decided to buy a 2010 Toyota Prius (yea 50 mpg!). From what I understand, a new car is generally a really bad deal, so we decided to go through Hertz Rent2Buy and found one with 20K miles on it for a significant discount.

I have an option to get three types of warranties. All of them are 100,000 miles or 5/6/7 years - whichever one comes sooner. Katy and I don't drive much, so I expect that we'll get to 7 years before the 100,000 miles.

Basically, if we were to get the extended warranty, 5 years would be 11.1% of the car price, 6 years would be 11.8% and 7 years would be 12.5%.

Since I don't know much about warranties, I would like some advice: Are they worth it, or are extended warranties -EV? I've got a day or two to make my decision.

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406 Views | Comments(8)

August 30,2010

My AC broke 500 miles past warranty on my new car and at that point I really wished I had bought the extended. My advice from nothing other than my own opinion is that yes they are worth while. A lot of shit could fall off your car in 7 years. Then again it's a Toyota and those things are suppose to run till the end of time.

ManWithBrisk

August 30,2010

Those warranties are always -EV, and the 20k miles (which are more like 50k because it's a rental) means that any of the obvious manufacturer issues will be worked out and repaired already. People who say to get them are always the ones who got unlucky and are willing to flush money in the future because of it.

Bbrash

August 30,2010

I'm sure one of the main reasons you are buying a Toyota is because they have a long history of reliability in general, plus great gas mileage in the case of the Prius. Your thoughts are not out of the norm, and as such there it is fair to say there is a premium on Toyota's and Honda's (as well), due to their track records. In short the way I look at it, I'm already paying more up front because I'm buying a history of quality and reliability, so why spend the extra dollars on an extended warranty. Looking around on google at Prius prices the median price for a 2010, depending on trim, is ~$22,500, 12% of that purchase price, is $2700, that’s a lot of money. From what I’ve read, extended warranties for almost all things are usually –EV. See these two Consumer Reports (non-profit/non-biased) links:http://www.consumerreports.org/cro/cars/new-cars/buying-advice/extended-warranties-4-08/overview/extended-warranties-ov.htmhttp://www.consumerreports.org/cro/money/news/november-2006/why-you-dont-need-an-extended-warranty-11-06/overview/extended-warranty-11-06.htmhttp://blogs.consumerreports.org/cars/2008/03/ex-car-warranty.htmlAs I understand it, the retail industry, whether it be electronics, cars, appliances, etc came out with extended warranties to increase their profit margins to compensate for their lower base price for their products. In other words, they now sell a widget for $10 today, whereas a decade ago they sold it for $13, but competition has driven the price down, so instead to make up for that, they’ll now try and PUSH an extended warranty on you for the widget for only $3. I’ve found at least in Canada, electronics places are the worst for this.

bigblue1ca

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Comment	I'm sure one of the main reasons you are buying a Toyota is because they have a long history of reliability in general, plus great gas mileage in the case of the Prius. Your thoughts are not out of the norm, and as such there it is fair to say there is a premium on Toyota's and Honda's (as well), due to their track records. In short the way I look at it, I'm already paying more up front because I'm buying a history of quality and reliability, so why spend the extra dollars on an extended warranty. Looking around on google at Prius prices the median price for a 2010, depending on trim, is ~$22,500, 12% of that purchase price, is $2700, that’s a lot of money. From what I’ve read, extended warranties for almost all things are usually –EV. See these two Consumer Reports (non-profit/non-biased) links:http://www.consumerreports.org/cro/cars/new-cars/buying-advice/extended-warranties-4-08/overview/extended-warranties-ov.htmhttp://www.consumerreports.org/cro/money/news/november-2006/why-you-dont-need-an-extended-warranty-11-06/overview/extended-warranty-11-06.htmhttp://blogs.consumerreports.org/cars/2008/03/ex-car-warranty.htmlAs I understand it, the retail industry, whether it be electronics, cars, appliances, etc came out with extended warranties to increase their profit margins to compensate for their lower base price for their products. In other words, they now sell a widget for $10 today, whereas a decade ago they sold it for $13, but competition has driven the price down, so instead to make up for that, they’ll now try and PUSH an extended warranty on you for the widget for only $3. I’ve found at least in Canada, electronics places are the worst for this.

August 30,2010

Well that came out looking like, $hit.

bigblue1ca

August 30,2010

Ahhh...just looked at the hyperlink you had to Hertz, so Avg price is 18-19km, still $2200 isn't free.

bigblue1ca

August 30,2010

I'm one of the suckers that usually gets them. I like having the peace of mind, and keep in mind you can negotiate the crap out of the price.. that's where their biggest profit margin is. So if they want 2.5k for it offer them 1.8.

Stake Monster

September 07,2010

don't bother veneer...as a guy who worked in the dealership (toyota then hyundai) extended warranties are -EV minus play. for one, not everything is coveredfor two, the things that are covered are PROVEN RELIABLE PARTS (like the engine!)my prius 2004 i bought it 160,000 km, and it was used as a taxi. still looks like one, only had one problem and it was jokes to fix. i highly recommend priuschat and lurk in there to learn about your new ride.Enjoy! although personality i would have waited for the new EV (electric vehicles you dork) to come out and reevaluate :)

vap3

September 07,2010

oh and if you ever want a mileage match ill give you 3 to 1 on your money if your ever in Vancouver British Columbia :Dyes that is your 2010 vs my 2004 taxi model. Although i'll take coaching over money anyday :D

vap3

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