Extended Warrany

In my case, I had the truck for only 5 months. I’d agree with you partially, I bought the 6/75 warranty to cover the non-powertrain items for years 4,5,6 and then the powertrain for year 6. For the $645 I paid, it was worth my own personal piece of mind to cover the extensive electronics on board the newer trucks.

I’m more than willing to agree to disagree if this was worth it. I understood going in that any time surpassed (even as the factory warranty ticked at the same time) would eat into any potential refund. But, then again, I was also buying the truck to keep for the long haul (8-10 years +), it just didn’t work out that way.

I was just pointing out that the warranty wasn’t non-refundable, which many of the “dealer” backed plans (paint protection, etc) aren’t.

 

we each need to make our own decisions, based upon the best available information.
my only interest is to inform, to help people make a decision from a position of knowledge.

Depending upon an individuals proclivity for diagnostics and ability to find a good third-party mechanic, I suggest that by the time the original warranty runs out most electronic parts are readily available from junkyard donor vehicles on eBay for far less than the new price the finance people scare buyers with. We’re already seeing $10,000 14 inch multimedia displays on eBay for a small fraction of that.

 

All fair points.

 

It is interesting the divergent of opinions. Some say extended warranties are a waste of money and just throwing it away. Some say it is a no brainer due to all the new electronics

I don't understand why some feel the need too preach to those who feel otherwise.

It is a personal decision

I always avoided the Extended warranties as they cost thousands and typically don't pan out. Toyota Dealer offered me one for $3400. That wasn't worth it to me and I declined. Through this thread I found the same exact Toyota Factory warranty for $1360 for 10 years. That made it interesting.

My 2014 Toyota Land Cruiser Amplifier failed in year 9 with no extended warranty. The new amplifier is $1600(part only). I found a reman one for $800 and replaced it myself.

As an engineer I went through the new Tacoma and in my view the amount of electronics has significantly increased. Like stated earlier, the screen is $10K or $1K at a junk yard and that doesn't include labor.

I had to replace a steering rack in a 2004 Land Cruiser at 9 years at $1100. A common issue not known about until years later. Items like that are hard to predict to those at Toyota setting the warranty prices. And whomever owned an 80 series Land Cruiser knows about the faulty pesky Heater hose that didn’t fail until 7+ years of use. Not to mention head gasket failures. Though those typically where 125K+ miles, but not always.

I agree with the argument that the prices from the factory (Before dealer mark up) are evaluated over a population to make sure Toyota makes a profit.

I also know that most electronic failures have a bathtub failure rate. Meaning the majority will happen early on during the original warranty period and work fairly well after that, but not all.

I like that I can transfer the warranty to a buyer should I decide to sell in 6 or 7 years. If you were buying a 7 year truck and found 2 identical in every way except one still had a factory warranty for 3 more years, which one would you buy? I would go with the one with the warranty as you never know how the previous owner took care of it. I tend to own vehicles for 10+ years so resale value isn’t a big factor for me.

To me, I bought a brand new generation new design that has all new electronics. This new system doesn't have a lot of time on it. Any of those systems requiring repair would easily surpass the $1360 cost for a 10 year warranty.

This same year we got a Cadillac Lyriq for my wife. They wanted $4800 for the extended warranty. That isn't worth it and my wife typically only keeps cars 6 or 7 years.

I paid cash for my truck and then separately paid $1360 for the warranty through Troy discussed earlier in this thread. Sure I can pay for repairs if they are needed after the warranty expires. To me it was the right decision as it was at the risk to value point for me personally. What the selling Dealer wanted for the same warranty wasn't. Everyone's risk to value point is different and I am confident I made the right decision for me.

I am sure even those that are completely against it would be intrigued if they could get a 10 year Factory warranty for $1, how about $100 or $200? $1360 set the right value for me.

I am not disagreeing with the arguments against as they are all valid. So are the arguments for. I am 64 and this is the first extended warranty I have ever bought and I have owned a lot of cars. The value wasn't there and I typically work on my own cars. Integrated electronics are something else. The lesson for me was when I installed an ARB Rear bumper (Only sold through Toyota Dealers) using the provided Parking Sensors, the system wouldn't operate and had dash lights like a Xmas tree. 2 dealers wanted $600 just to register and calibrate the new sensors on my 2024 Tacoma. That is an example of working on a fully integrated software hardware system which is unlike previous generations. Fortunately for me I had the stock bumper sensors and installed them into the ARB Rear bumper and everything worked and doesn't look to me like any recalibration is required.

Do what you feel is right for you. Then you will have no regrets. If I go 10 years without any issues, I will be estatic and have no regrets.

This thread lacks pictures so here is my 2024 Tacoma TRD Off Road that I have modified with ARB Rear Bumper, RCI Pike Front Bumper & WARN winch, RCI Skid Plates,CBI Sliders, All Dogs springs, 33" Toyo AT# OC tires including the spare. Ham and GMRS Radios, Molle Panels, OEM Tonneau Cover. I love this truck and glad I found a factory warranty at the right price point for me.

 

These are my thoughts, 100% and more eloquently stated than I could. This was also the first vehicle I purchase an extended warranty for. The dealership offered extended coverage for around $2500, which was past my comfort point. Through this forum, I found Troy and found a plan with miles and cost that justified the purchase for me.

I am not a mechanic, but I have seen enough new tech fail in vehicles to know that replacing a head unit or other electronic gizmo 5 years from now could easily surpass $645 or $1300, even if the parts were free. To each his own.

 

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True, but since my Toyota SUVs are modified I always get better deals selling private party. My BMW, I took to CarMax

Like I said, not a factor for me in the decision to buy a warranty.

The cost and being a factory warranty with zero deductible against the fully integrated new suite of electronics and Software are what made the decision for me. A previous generation Toyota like my 200 series Land Cruiser, I would have passed.

Part of that is my 38 years of engineering work designing, integrating and operating spacecraft which are very complex and integrated systems. This experiance base is what I used to access the risk to value of the Factory warranty for $1360 (10 years) against all its new fully integrated system. When I replaced a Parking sensor on my Land Cruiser, it worked fine, but the new Tacoma needs to register and calibrate it or it takes the entire safety/parking system off line as I described in my ARB Rear Bumper install.

Its no longer just the parts and labor to replace it, it is also the labor to readjust/calibrate/update the integrated Software baseline

 

I opted for the extended warranty on the base model '94 4x4 22R-E I bought new in 94. Never had a problem with the motor, but the extended warranty did pay to rebuild the transmission so that worked out.

I got the tech package on a 23 only because it has a 10-yr warranty. With no extended warranty, I would have opted for barebones.

Am very curious how many of those arguing the extended warranty is a waste of money actually have the tech package or are running close to an 'all computer' setup like the tech package. Disclaimer: maybe all '24 onward are 'all computer', I never checked them.

 

Fair question.

I have a 2017 TRD OR with Premium & Tech package with backup camera / parking sensors / gps / etc. Also added frameless autodimming homelink mirror, tailgate power lock, moonroof (and other options).

Purchased September 2016, so nearly nine years and over 100k miles.

Other than normal maintenance / consumables I've experienced only one problem - tailgate power lock sometimes didn't. Fix was a simple clean & relube the mechanism. 30 minutes in my driveway.

My 2016 Mazda Miata GT is techy as well with the windshield camera for lane departure assist etc., parking sensors, backup camera (I added it, sourced parts from Japan), etc. Also zero problems, just regular maintenance stuff.

Apart from all of that - the people pricing the extended warranty policies are not feeling charitable. The policies are priced to bring in enough revenue to cover the administration costs as well as any expected repair costs, and presumably some profit for Toyota and the dealers as well.

The policy buyer is making a less than 50-50 bet on realizing a payout in excess of the policy cost unless somehow the buyer knows more than the policy underwriters. As I'm not an expert in automotive electronics longevity, I prefer not to bet against the house.

 

Interesting as my 3gen is also a premium which includes the tech package. Electronics reliability is something I deal with on the new products side (computer industry, not auto), so that does probably jade my expectations which is likely why I buy the last year of each model ('94, '04, '23). I guess I can't imagine not using the warranty in years 4-10, but worst case is I slept better having it lol.

 

Those arguing that extended warranties are “a waste of money”, are just arguing to argue………(no real experiences, just opinion).
I originally did not buy the Toyota Platinum plan, with my purchase……..the cost was extremely high, and financing it was never an option……
bUT , thanks to other TW posters, I followed the info, and bought my Toyota Platinum plan from one of those dealerships around the country, that we’re selling the plans for COST…..(less than half) and the money equation became too easy. good thing I did, because Toyota just restricted the practice.

to those that have owned cars that have not had mechanical breakdowns……..good for you…(you’ve been lucky)……BUT the new Toyotas are not built in Japan anymore……..Baja California, Canada don’t make Toyotas as well as Japan…..

 

I’m just talk house odds. The game is stacked in favor of the house, extended warranties will be priced such that the house wins. Though I’m open minded.

Please describe the situations in which manufacturers would offer extended warranties projected to lose them money.

Through forty years of vehicle ownership I’ve had two failures that might’ve been covered by extended warranty. That includes Ford and GM but those were close. Lol.

Long game - I’m way ahead by self-insuring. Once the vehicle is paid off, I keep making “payments” into an investment account. So instead of paying interest on a warranty I make capital gains on the money instead. Then I use that for maintenance costs and then down payment on next vehicle.

 

“I’m just talk house odds”
NO, you are talking what you THINK are house odds……….you don’t actually KNOW…….

TW was/is intended for Toyota owners to help other Toyota owners………ie: thats how I discovered Toyota Dealers selling Toyota Platinum plans at COST………I then, reposted the contact info and my great experience……for others to take advantage.

I buy Insurance Life/Car/Property/Home as well as a car warranty for MY BENEFIT………I could care less on the profit/loss for the Company selling it.

I bought a 7 year policy for under $700…….YOU actually think that I’m not going to cover that………I hope you’re right, BUT with my 4th gen being built in Baja California, and almost $200 Labor rate at Toyota dealers……..hmm.

btw, your “capital gains” argument is hilarious………please show your math……

 

Maybe, but would you knowingly sell a product/service you knew you were going to lose money on? 7% of the warranty is paying the seller a commission, at least 20% is going into overhead, and if you're not expecting at least 20% profit, you'll invest your money on something else. Given the unknowns of new model reliability, you're going to probably price it at 50% profit so you have extra margin. We're talking venture capital risk/reward. That leaves, at best, half for warranty repairs.

Let's say I sell 100 warranties at $1,360. I can afford to spend half of that ($68,000) to stay profitable. Half of the warranties I sell will never make a claim. If 10% of the warranties cost me $3,500 each ($35,000) I now have $33,000 for the 40% remaining warranties which averages out to $825 per vehicle. 90% of the warranty buyers lost money.

If you think you are going to be one of the "lucky" 10% and/or an unexpected $3,500+ expense would crush your finances, then a warranty is a good deal.

 

I think there is an opportunity to look at both sides of this specific approach. I’d argue (I have no numbers, just guesstimates based on the amount of new tech on the trucks) that you are correct from a company perspective, that you may sell $10k worth or warranty and end up paying out $5-6k for claims. However, I would take the position that those claims may come from 2 vehicles at $2-3k each, meaning the owner of those would be on the hook for that repair without warranty. Spending $700-1500 up front when I have the money available is worth the peace of mind, and saves me from being hit with a bigger bill unexpectedly.

second point I’d lean into is that the realized cost for the buyer is much different for the company in that the repair cost for the buyer is a straight transaction for parts/services, while the company, who is already paying the techs on staff, likely absorbs some of the “cost” by nature.

 

Appreciate the conversation, man. I respect your points. This was the first vehicle I ever bought an extended warranty for, and the first that made sense for me. I’m 45 and I’ve purchased my share of new vehicles between myself and the wife.

 

Dayum, son. Who pissed in your Cheerios? If you’re happy with your bet you shouldn’t need to be so defensive. That you are suggests doubt in your choice.

So here’s your chance to explain your assessment:

Name a successful insurance company or casino who didn’t have the house odds in their favor. Did State Farm build a huge tract of prime real estate office buildings in ATL by losing money? How about Las Vegas - did Harrahs or Bellagio or any of the others build their empires by losing money? How are these companies spending so much when the consumer usually wins?

Is Geico or Farmers or Progressive or any others spending all their TV advertising budget to lose more money!

Or might it be the other way round? Maybe they make money by stacking the odds in their favor, charging more than they pay out?

Or perhaps explain - in detail- why Toyota sold you a policy for $700 that they the manufacturer thinks will lose them money in aggregate. What’s the logic there?

So sure, you have a 7 year policy. Supplements your 3/36 for four years if you have the truck that long. Supplement the factory 5/60 powertrain for two years. Doesn’t impact the factory 8/80 emissions warranty. IF you actually keep the truck all seven years you may see a benefit - but Toyota is betting you’ll trade (or wreck) it long before. Then you get half or less back at best for a couple years actual coverage.

I’m just speaking facts. Refute any which are untrue.

Sure, there’s a value to peace of mind, and that’s your decision. I support that as it’s a personal emotional value call, so I wouldn’t argue against feelings. At the same time, if you’re confident in that perceived value you wouldn’t need to defend it to a Random Internet Stranger.

Please explain which part of +4x your money in ten years in unclear. vs paying interest on the warranty you added to the truck loan for four to seven years which most likely won’t pay out as much as you spent on it.

 

Another way of stating the point is that insurance is to protect against possible future costs one wouldn't be able to afford to pay for. I would not buy insurance on my bike. On the small chance it was ruined, I'd just buy another. Health insurance is intended to protect you against that huge bill. You pay regularly and consistently into a pool which you can plan for out of regular income, so as to avoid that one huge catastrophic illness bill that would ruin you for decades (in the US anyway, ugh!). Most people will have paid more month by month into the plan than they will recoup in cost savings on bills, but they avoid that one huge life-altering bill. It's reasonable to do, if you realize on average you'll pay more in than you get out, as the cost for that security. Some will win, many more will lose. That's how the industry is built. Capitalism still dictates corporate decisions. And we like it that way.