lovexus

Totally agree. Extended warranties is usually over priced. Buying the Lexus ES300h also bought peace of mind. My current RX350 has over 110K and never have any problem. Just change oil and do regular maintenance. I always call around and one of the local Lexus dealer always has some sort of discount or promote to reduce cost of maintenance. Saved the money and you most likely come out ahead

ElliotB

"the majority of those who buy extended warranties are not going to come close to recovering the money that they spent on those warranties"

Extended warranties are like life insurance policies, good to have but best when you don't have to collect on them. I have always hoped with every vehicle I have purchased such a policy for that I would never have to use it - I never bought one with the hope of my vehicle breaking down repeatedly and that the repair costs would exceed the cost of the policy so I would end up recovering the money I spent.

The ES300h is a complex vehicle and repairs, if necessary, are likely to be quite expensive. While repairs are unlikely for most Lexus vehicles, not all will are trouble free. Like any insurance policy, there will be some winners and some losers. Peace of mind has its price.

lesz

In a way, a "complex" vehicle like the ES300h should have even less need for an extended warranty because, for the ES300h, the regular Lexus warranty covers the components of the hybrid system for up to 8 years and 100,000 miles.

Also, I would suggest that, while many would be willing to accept the notion that "peace of mind has its price", a good number of them would not be willing to pay that price if they had any idea at all of just how great the profit margin is on extended warranties.

In any case, I have little interest in convincing those who are inclined to buy extended warranties that they should not buy them. The more money that a car dealer can make from those who buy extend warranties just means that they have to make less money from selling cars to the rest of us, but, at least, I think it is useful for those who are inclined to buy the extended warranties to have some understanding of how big the markups are on them and some knowledge about the fact that what those warranties cover is, in reality, significantly more limited than what it might seem like on the surface.

ElliotB

As most people only keep their vehicles 3 years anyway, the extended warranty issue is a non-issue for most. The only people that regret not buying an extended warranty are those that contemplated getting one and have a breakdown after their factory warranty has expired. Unfortunately, even with Lexus, it happens.

I am one that is thankful that they are available and as someone who has in effect 'lost' money on several (but not all) of the policies I have bought through the years, I am thankful that I have not profited. Insurance is just that, insurance.

lesz

[QUOTE=ElliotB;8240671
I am one that is thankful that they are available and as someone who has in effect 'lost' money on several (but not all) of the policies I have bought through the years, I am thankful that I have not profited. Insurance is just that, insurance.[/QUOTE]

But an "extended warranty" is not an "insurance policy". Companies that sell "insurance" are subject to significant monitoring and regulation. Among other things, they must report the percentage of the premiums collected that are paid out in the form of claims. On the other hand, companies that sell "extended warranties" are not subject to that kind regulation or scrutiny. You could decide to sell extended warranties and have a profit margin of 99%, and no one would be the wiser. That is the reason why those who sell "peace of mind" for cars, TVs, appliances, etc. call the products that they sell protection plans or extended warranties and not insurance policies. Doing so allows them to avoid having to disclose to anyone how outrageous their profit margins can be.

The point that I have made that you seem to be deciding to ignore is that, for most, the price of peace of mind is a reasonable price to pay in many instances. It is certainly reasonable when you are protecting against catastrophic loss, and it is reasonable when the company offering the plan that gives the "peace of mind" has a reasonable profit margin on the products that it is selling. Again, many of those who feel the need for peace of mind and who have bought extended warranties would be deciding to go in a different direction if they had any idea of just how big the profit margins typically are for extended warranties.

Mike728

I don't think you're giving people enough credit. I'll bet the majority of people that purchase the warranty are more than willing to give 100% profit margin to the dealer, and understand it's usually a huge profit generator for the dealer. I typically do not buy any warranty on anything, as I know it's just more profit for the seller. I purchased it for my ES for two reasons. First, it's a brand new platform with some unproven features. Second, the dealer knocked off more than $800 off their original price, which made it easier to swallow. If I keep the ES for 10 years, I'll have peace of mind knowing that it's covered for almost anything that may go wrong. Hoping nothing does, but for the relatively small amount it cost me, it was well worth it.

Brozee

Don't see the point in a warranty on this car. Everything that could or would go wrong is a easy fix as it is Toyota's normal V6 engine. Only time it would be expensive if it were something electrical, but even then this car's computers are pretty easy to work with and basic compared to others I've seen.

On the other hand my buddy who has an S8 and my W12 have both had over 5k in repairs, so on those cars the $2k warranty or whatever it cost, it was worth it. Although on a Lexus due to reliability I think it would be an absolute waste of money.

jml33

You should just take the money for the cost of extended warranty and put it in an account for car repairs. Will get a better return on your money.

Arty101

Except if it's an Audi, which may be well worth the money.

ElliotB

Not all Lexus vehicles are perfect although my last one was and this one appears that it likely will be - just look through some of the other forums.

For about $15-$20 per month for a genuine Lexus warranty through Jerry Johnson, you can enjoy 8 years of worry-free driving. Sounds like a good deal to me for anyone that plans to keep their vehicle beyond 4 years!

jonmanch

Is Jerry Johnson's Extended Warranty honored by all Lexus dealerships?

gmanusmc

You make a good point Elliot - this is a personal decision one must make based on their needs, financial ability, and how long they plan to keep the vehicle. For those who say just put the money aside, at 20 bucks a month, you could pay for a $4500 engine or transmission repair in a mere 225 months.

Bill G

Arty101

So lesz, are you saying the ES300h is automatically covered by Lexus for 8 years/100K miles? If that's the case, no worries for the 300h owners.

ElliotB

The warranty the Jerry Johnson is selling is the genuine LEXUS warranty. I have bought Toyota warranties (genuine Toyota) from him in the past, always at a significantly lower price than the Toyota dealers in Florida could offer as these warranties are regulated in Florida and Florida dealers cannot discount them.

The Lexus extended warranty is a continuation/extension (wrap) of the existing vehicle's warranty. Although you can buy the warranty at any time before the factory warranty expires, if you buy today, you pay today's rate. In 2-3 years, the same warranty will likely cost more.

The 8 year warranty is ONLY for specific hybrid components, not the rest of the vehicle which is covered for 4 years or 50k miles. Specifics about the various warranties on the 300h can be reviewed here:

http://www.lexus.com/models/ES/ownership/warranty/

Arty101

One can only wish, although it was only wishful thinking.