casualcass

Hello, new to these forums. I've previously own an RX, and when Lexus changed their CPO warranty benefits to unlimited mileage, this has me considering a CPO 2013 ES350.

I typically run my vehicle until expected repairs eclipse its value, case in point, I am currently replacing a 2003 Forester, I am looking for a comfortable commuting vehicle, I will drive around 30k miles/year, so this unlimited mileage warranty has me intrigued.

The ES350 I am looking at is still > 1 year of factory warranty, plus it includes 2 years/unlimited mileage CPO warranty. I can additionally purchase more years of unlimited mileage coverage for:
1 year=$1,715
2 years=$2,110
3 years=$2,525
4 years=3,005
5 years=$3,540

So, I can purchase a CPO ES350 with 8 years/unlimited mileage of essentially bumper-to-bumper warranty (Platinum VSA), which will very likely be > 240k miles

My question is to ES350 owners, is this a good deal? Does a ES350 typically incur over $3500 of non-wear/tear repair over 240k miles?

Thanks for your time!


p.s. According to Edmunds, I can expect at least $4795 in repairs over 8 years (if I use the year 5 repair cost for years 6,7,8), but this calculation presumes only 15k mi/yr, so only 120k.
http://www.edmunds.com/lexus/es-350/...2/cost-to-own/

azipod

Insurance will always sell you on "piece of mind" but I doubt many on this forum have spent big $$$ on unexpected repairs. I say save your money, and self-insure by putting aside some money each month. That way if you had to use it down the road, you'll have the cash but if you don't, then do something else with it. I've never had to spend big $$$ on unexpected repairs. But again, I don't go to the dealer to get work done. Makes a huge difference.

bc6152

Throw $10-20 dollars into a coffee can each month and save it for a rainy day. No need for a warranty @ $3500.

lesz

I'm confident that, if car buyers knew that the markup on extended warranties are generally 400-500% or more of what those warranties cost the dealers, very few would give any thought to buying them. Further, while a very small percent of extended warranty buyers may make claims that exceed the cost of the extended warranty, in the vast majority of cases, those who buy extended warranties will make no claims or, if they do make any claims, most will end up recovering only a few hundred dollars of the cost of the extended warranty.

And the situation is similar for buying a CPO vehicle. For that 2013 ES, you will be paying a premium of about $2500 or more for that CPO warranty, and the cost to the dealer of that CPO warranty is only a few hundred dollars.

That means that, for the OP, he/she could be paying as much as $6000 extra for a CPO vehicle and extended warranty ($2500 for the CPO warranty and $3500 for the 5 year extended warranty). There is no question that, both CPO vehicles and extended warranties are 2 of the biggest profit generators for dealerships.

With that 2013 ES, there is still some of the factory bumper-to-bumper warranty left, and there is still a good portion of the 5 year, 70,000 mile power train warranty left. The likelihood is that any expensive repairs during the first 70,000 miles are going to be covered by the factory warranty, and there is very little likelihood that, even after the factory warranty has completely expired, there will be any needed repairs that exceed the $6000 cost for the CPO status and extended warranty.

If I was interested in buying a 2013 ES that was on a dealer's lot as a CPO vehicle, after negotiating the best possible price, I would tell the dealer that I'd like to buy the vehicle, except that I wanted to buy it as a non-CPO vehicle and that I would do so if the price was lowered by the $2500 CPO markup. Then, I'd put the $6000 that I might have paid for the CPO status and extended warranty into a repair fund in case any non warranty repairs were needed.

Alternatively, instead of buying a 2013 CPO vehicle and an extended warranty for $6000 more than the cost of a non-CPO vehicle and no extended warranty, I would buy a non-CPO without an extended warranty and use the $6000 savings, say, to trade in that 2013 car a couple of years earlier than I might otherwise have done so. By doing that, not only will I end up with a newer vehicle a couple of years sooner, but that newer vehicle will likely still have a good portion of its factory warranty left.

There is no question that buying both CPO vehicles and extended warranties gives dealers thousands of dollars in extra profits that could otherwise have been used by the car buyer for many purposes, including being able to buy a newer car sooner.