what do you think of extended warranty

[DFAM]

Hey guys:laughing:, this is my second time posting. Today I would like to hear your opinions about the extended warranty for tractors. At present, both Mahindra and LS(TYM might) offer 5yrs warranty for power train,2-3yrs for all other parts:thumbsup:. Not sure about what Kubota and john deere offer. I am sure almost dealers around you will offer extended warranty. My questions are, how long do you want the warranty to be, at which rate will you buy the extended warranty? Many thanks.

 

[kenmac]

Just me . I don't buy extended warranties on any products I buy.It's insurance. The insurance company is betting nothing happens & most times they win. Insurance companies aren't in the business to lose $$.... Self insure & save your $$$

 

[rsewill]

Just me . I don't buy extended warranties on any products I buy.It's insurance. The insurance company is betting nothing happens & most times they win. Insurance companies aren't in the business to lose $$.... Self insure & save your $$$

Agreed. But if the standard warranty is longer then I will have more interest in the product.

 

[Combustix]

I agree with kenmac have never bought an extended warranty, and have never had a warranty issue on anything. When asked if I want it I will ask back why do I need it, apparently there must be something wrong with your product then. Will throw the dealer off, and he'll explain how great it's really made. I have never let warranty influence my decision, if it's gonna break it's gonna break after the warranty runs out, extended or not.

 

[Cat_Driver]

I only buy them every once in a while on expensive stuff and it has paid off a few times. Recently on my vehicle I paid $1,200.00 for additional warranty and it already paid for itself.

My Brother buys it on everything he buys and collects on almost everything he buys. He bought insurance on his $59.00 printer and a year later it wasn't working they gave him a newer model. He got his washer rebuilt with every part at no charge because they were tired of getting calls from him. He just got a new refrigerator same thing. He always gets a new phone because of insurance.

He bought insurance on his daughters car paid $1000.00 for a 100 warranty, and got almost 8K in service / labor SO FAR.

 

[Folio]

Having sold both new and used cars AND extended warranties, I've had some experience with this issue. The tractor market (with which I'm not familiar) may be different, but I suspect not. For what it's worth:

In the last 20 years or more retail margins (profits) have become steadily slimmer as customers have become more price conscious. Over the same period of time "extended warranties" have become more popular. You can guess the reason: they add to the seller's profit margin and, not incidentally, to the sales person's commission. For every $100 of extended warranty I sold with a car, I'd earn between $10-15. Add another 15-20% for the dealer and still more cushion for the company providing the warranty and you get an idea of where your money is going for the coverage you get. In fact, there were times when I earned more money from a warranty than I did from my commission on the car. This was particularly true of used cars because extended warranty costs were considerably higher than for new vehicles.

You see the same thing happening with electronics, big ticket appliances, and even run-of-the-mill power tools from HD or Lowes. Whenever someone starts to tell you about an extended service contract, bear in mind they will earn money if they sell it to you.

This is not to say such warranties are necessarily a bad thing. You have to weigh the cost/benefit. First, pay attention to the small print, particular the exclusions. The best warranties are those that extend the OEM's warranty (on new equipment) without qualification or cover events that most commonly occur on used gear (a water pump is more likely to fail than a transmission, for example). Second, know the hoops you have to jump through to activate the warranty if needed. Many are more hassle than they are worth. Others are a snap. Third, compare the cost of the extended warranty to the cost of the product. The general rule of thumb is if it exceeds 5-7%, be careful. If it falls in that range, the coverage is reasonable, and coverage is relatively easy to activate, then it might be a good deal.

Last, consider who is selling the item to you. Established vendors/manufacturers/suppliers know they have more at stake with your satisfaction than do fly-by-night jerks. Doesn't matter if you are dissatisfied with the product or the extended warranty, you are still dissatisfied.

Hope this helps.

 

[DFAM]

It definitely helps a lot. Actually, I am considering extending basic warranty and offering optional long-term warranty to help the dealers. So your opinion will be much helpful to me!

 

[brokenot]

Good advice so far, I'd just like to add that on some of the equipment our sales division sells, an extended warranty is available. The people that choose to buy it are *almost* always convinced that the warranty is not just "extended", but also that it's more "all-encompassing". And in most cases it isn't.

The confusion most frequently arises when something happens during the warranty period that isn't a warranty issue. Even if the customer is shown via the warranty documentation that whatever the issue may be is not something that is covered, (such as allowances for downtime, getting a loaner while their equipment is in the shop, damage due to misuse or neglect, etc.), their first response is always, "But I have the extended warranty....."

As mentioned earlier, the "fine print", (in quotes because it's often not "fine print"), needs to be read and understood. It's not unusual at all for a customer to bring in something for service two, three, four years after purchasing it, and the warranty booklet that's packaged with the operators manual is still shrink-wrapped in the factory plastic. How someone can "know" what's covered and what isn't without ever reading the material is a bit of a mystery. Reading the stuff is important, because nothing anyone "tells you" trumps what is clearly spelled out in print. Salesmen say all sorts of things, which is why warranty and operators manuals mention that the printed word takes precedence over what anyone "says".

Most "warranty issues" aren't warranty issues at all. That may sound harsh, but it's the truth. Consumers tend to think that the exclusions in a warranty document are there only for the purpose of allowing the manufacturer to wiggle out of footing the bill for anything that may occur. That isn't the case however. Anyone that has spent some time browsing forums for anything, (be it a tractor, truck, motorcycle, whatever), has undoubtedly seen posts from end-users like this:

"My manual says to use *this grade* of engine oil. What do you guys think I should use?"

or....

"The manual says not to tow over 8000 pounds, but my camper is 10000 pounds, I should be okay there....right?"

In other words, a lot of the exclusions deal with topics such as for the warranty to be honored, the equipment or vehicle needs to be used and maintained in the manner the manufacturer intended. Warranty coverage is a two-way street. There are obligations for both parties to live up to...

 

[TripleR]

Like several others, I don't buy them.

 

[Dr_Zinj]

9 times out of 10, an extended warranty isn't just a waste a time, it's free money for the seller. Rule number 1 for businesses, never sell something that doesn't earn you a profit. Extended warranties are merely another product they sell.

My way of figuring is, you have a basic warranty on most things that's standard and included in the price. If that's not good enough, buy a different product.