DanBryant

Hello,

I was looking at purchasing a Lexus Platinum extended warranty (10 yr / 125K for $2900.00), but the dealer I'm purchasing it from is out of state.

I understand that Lexus doesn't want us to buy extended warranties out of state (though we can buy cars out of state funnily enough), but was wondering what mail forwarding service you guys were using to forward mail from a dealer's state to your home state?

If on the other hand you found a dealer who didn't care about the out of state ban and sold you the warranty any ways, would you be able to provide me the dealer / warranty seller's name?

Thanks,
D.B.

Mike728

I thought you bought a CPO. Even if you didn't, that's a ridiculous amount of money to spend on a Lexus warranty.

LexBob2

I agree. $2,900 sounds very high even for a Platinum. VERY profitable for the dealer.

lesz

For the car that you bought, you still have somewhere between 2 and 3 years and 20,000 miles left on the factory bumper-to-bumper warranty. You will have 3 years and unlimited mileage of coverage from the CPO warranty. And you will still have between 4 and 5 years and 40,000 miles of coverage left on the factory power train warranty. If you buy the extended warranty, you are betting that you will have a need for $3000+ of covered repairs needed during the time between when the factory bumper-to-bumper warranty, the CPO warranty, and the power train warranty all expire and the time when the the extended warranty expires.

Yes, there is a chance that that could happen, but the chance is slim. Instead of buying the extended warranty, you very likely would be many dollars ahead by putting that $3000 into an "emergency repair" savings account. Further, if, over the course of ownership of your next 4 cars, instead of spending $12,000 for extended warranties, you put that money into a repair savings account, you would be virtually guaranteed to be thousands of dollars ahead.

Extended warranties, even at discounted prices, are among the biggest profit generators for dealerships. They typically have markups in the range of several hundred per cent, which means that, typically, those who buy them will collect nothing or only a small fraction in covered repairs of the money that they paid for them.

The bottom line is that, if a dealer can sell you an extended warranty, that dealer can turn what otherwise would have been a minimum profit deal into a very large profit deal.

DanBryant

Hello Mike,

Yes it was a 2016 CPO with 30K miles.

B.D.

DanBryant

Hello LesZ,

I see your point.

The thing that worries me is that I'll be keeping this car for the long haul, and it has over 40 sensors.

I'm not worried about the powertrain in the slightest, in fact a buddy who's a mechanic at a Lexus dealer told me that the most common issue my 2016 ES 350, are valve cover leaks.

In other words, a pretty small problem (compared to other vehicles - and a pretty easy fix - just a new valve cover gasket / sealant).

But the electronics on the vehicle are a whole other animal. All it would take would be a few sensor issues / dash or navigation problem, and we're looking at easily exceeding the value of the extended warranty.

That said, I may be able to get a much better deal, as a co-worker of mine is very close to a specific Lexus dealer. He's apparently purchased 8 or so Lexus' from this dealer, and they've given him a great deal on an extended warranty (I believe it was less than $1,000 for a pretty good warranty). So with any luck, I'll be able to score something with them.

Thanks for all your help,
B.D.