[MINIgirl]

I am in Northern California and getting ready to order my MINI. Here, it comes with a 36,000 mile/3 year warranty. There is an option of getting 50,000/4 year extended warranty.

Is it a good idea to get the extended warranty? Also, what is the cost and is the cost negotiable?

Thanks

 

[TheScotsman]

Hi. I am unsure how thing operate in your neck of the woods to comment on cost and negotiations.

In regards to whether the extended warranty is worth it really depends how long you are keeping the car. I believe any car should show its manufacturer defects throughout the first three years for them to be repaired under warranty, and all going well you should have a good few years of trouble free motoring. After which the things going wrong would be wear and tear and not covered under warranty anyway.

This thought process only works of course providing you didn't buy a lemon. Which if that was the case you would probably get rid of it before the three years were up anyway.

 

[Lawnmower3000]

It's not a warranty. It's insurance on repair costs, with a LOAD of fine print. Now ask yourself , "Are insurance companies in business to lose money?" Nope, not in any universe I know of. So in the aggregate, they're paying out less than they take in, actually by quite a lot. So now ask yourself, "Why do I buy insurance?" Well, because you want to protect yourself against catastrophic losses. By catastrophic, I mean a loss that so large (your house; a lawsuit when your pit bull rips some 8-year-old's face off) that you utterly can't afford it. Thus, insurance plays the probabilities. It's unlikely that YOUR house will burn down, but likely that out of a population of 1,000,000 customers that SOMEONE'S house will burn down, so the insurance company aggregates the risk and you transfer your catastrophic risk to them for $800/year.

Okay then.... A "warranty" does essentially the same thing. But in this case the probabilities work against you. What are the chances that you'll have a covered repair that will seriously impact your personal finances if you have to pay for it yourself? The answer is "Not especially likely". Therefore, you're far better off, in the long run, by self-insuring against a high-cost repair. Take what you would have paid for insurance and put it in a Repair Account. You'll end up many $$ ahead. An extra advantage you have here too is that some of the probability of encountering an expensive repair is IN YOUR HANDS. That's called Routine Maintenance. It's also being attuned to the operation and characteristics of your vehicle and investigating/addressing small anomalies before they become BIG EXPENSES. IOW, if you don't neglect or ignore your car, you greatly reduce the risk to your wallet.

 

[Lawnmower3000]

I also agree with T.Scotsman about failures in time. Most problems will present themselves in the Infant Mortality period. Let's say, before a year passes in normal usage. After that, you see failures related to design and manufacturing defects that tend to be age and usage related. This is the famous Bathtub Curve. High failure rates in the beginning, falling to a low level for a relatively long period of time, and then rising again due to wearout phenomena. IMO, this is less of a consideration than the eventual unavailability of critical parts. Some manufacturers have discontinued availability of critical items in as little as 10 years after end of production. (Example: Ford seat belt modules in some vehicles) Insurance isn't going to help you there.

I think that planning to keep vehicles of this level of complexity running for more than, say, 15 years, is utter folly. All those technology-intensive features are great while they're working, but when the electrolytic caps start drying up and your fancy LCD display just displays jumpy colored lines, you're going to be in for some unpleasant surprises. Multiply this phenomenon by 30 to account for all the other stuff in the car. (Electronic power steering. Electronic torque-steer compensation. Seat belt/airbag sensors/computers. Incredibly complex entertainment systems. Incredibly complex instrument clusters. LED drivers. Headlight aimers. And so on.....)

 

[Iznik]

I agree that many extended warranties are a minefield of obfuscation and sharp practice and getting a claim dealt with can sometimes be more stressful than the car's actual problem. To avoid disappointment have low expectations and perhaps you'll be happily surprised. Or manage your own risk.