Checked today at the dealer and I can get a 3yr./100k bumper to bumper extension with 0 ded. for 1800.00. Good deal?? or check around at other dealers??

 

All depends......do you do most of your own work? ,do you forsee a lot of repairs other than the engine?, engine is already warrantied for 100K. what would it cost to repair most things you forsee going wrong? One tranny and you would be up on the deal, but if you treat it right and maintain the mechanicals, you can go way past 100K without trouble..........I'd have to pass if it was me, but that's just me!

 

Its still 50% cheaper than the seemingly mandatory front axle rebuild at 60,000 miles.
Or so I've read on here.

 

I am in the same boat as you trying to decide if I ahould buy an extended warrenty or not. But when I talked to the dealer the "Gold" package to go 100,000 miles was like $3,500.

 

is it three additional years to the 3 yr/36000 bumper to bumper. if not i would say complete waste of money. jmho

 

I took some time to do this analysis so I hope someone pays attention to at least argue my numbers and tell me I'm full of it.

Warranties are funny. You pay money to hope something big goes wrong with your truck so you can get your money back.

What's the actual probabilty of something on your truck failing within the 3-year warranty period that costs more than $2,000 to repair? The answer to this question can nail down the value of the warranty immediately.

But lacking that information (I know it's out there however - any service manager would have some kind of metric we could use to make these numbers pretty solid), I will assume a 10% probabilty of something huge breaking on your truck. I believe that is quite high - to assume that one in ten owners will need to pay more than $2000 on a repair within a 3 year period of ownership. If this were truly the case, none of us would actually buy these trucks because their reliability would be less than garbage.

Here's my analysis of the numbers provided:

Cost: $1800
Duration: 36 months
Probability of payout: 10%
Payout amount: $2,000
Rate (the rate at which you could otherwise invest your money to let it grow if you didn't throw it away on a warranty): 6%

The present value of the warranty if you are the 1 guy in 10 whose truck takes a dump that costs over $2,000: $129

The present value of the warranty if you are one the 9 guys in 10 whose truck requires only regular maintenance: -$1,800

The net present value of the warranty given all the assumptions: -$1607.13

As you can tell from the numbers, I chose a breakdown costing over $2,000 because any breakdown costing less than $2,000 wouldn't get you any of your money back either.

The warranty will have a negative value through even higher breakdown probabilites and higher costs... it really works against you, which is why it's pushed so hard and so often.

Bottom line: don't buy it.

 

Add into that also, that most people finance that amount in with the truck - so figure in the interest!

 

The only time I've ever made out on an extended warranty was with my 04.5. $1,600.00 but it included 28 FREE oil & filter changes. The oil & filter changes alone were worth it. At the time I was changing the oil out almost every other week @ 10k mile intervals. Driving that many miles I just didn't have the time or energy to do it and changing the oil in the driveway during the cold winter months was just not that appealing. I also got to develop a good relationship with the diesel techs at my dealer - they won't put a regular grease monkey on the diesels even for a routine oil change - thankful for that. When I got the 07 they discouraged me from getting the extended warranty due to the high mileage I put on the truck and of course NO more free oil changes. So we'll see with this beast how it goes. I did learn a lesson with the 04.5 though, with the kind of work I do, I will not keep a truck over 200k miles anymore. The money I spent in repairs from 200k miles to the final 330k miles could've made quite a healthy down payment on this truck.

 

Tell me more please! I am @ 151K on the ticker - hoping to get 350K out of it! I have a lot of experience, to say the least, but what did you have that was soo expensive? I am already looking at upgrading torque converter and rebuilding trans with a better valve body ( beofre it goes out!), and rebuilding the front end steering and suspension. All of which I am doing myself #1 because I can #2 don't like anyone else working on my truck #3 to save money. What else on top of that did you have?

 

Just want to say again, that my 04.5 hardly ever sat still for more than the time it took for me to "recharge" my batteries with some sleep. It was on the road 7 days a week, working hard, mostly towing heavy. The repairs were mostly to the Dodge wrapper, however I did have an injector tube go bad which Dodge wanted to repair by replacing all six injectors to the tune of approx. $3,000.00. Other repairs included, throttle controller replaced, belt tensioner & serp belt, #6 injector line broke, replaced all the ball joints, tie-rod end, steering box started to leak, four sets of front hubs (2 on each side) 2 sets of U-joints on front wheels & driveshaft, 2 driveshafts, 2 tranny rebuilds - stock rebuilds as both times it broke down I was cash strapped and my dealer lets me pay for big-ticket repairs 90 days cash, complete rear rebuild from bearings inward, radio/6-CD player replaced, front door speakers replaced, dash lights were burning out - non-servicable bulbs of course. I felt like I was rebuilding the truck with all my profits. Of course, there were the 4 rides on the flatbed due to breaking down on the road at about $400.00 per ride.
BUT, let me also say this, at 330k miles, if someone would use it normally, towing occasionally, it more than likely would have lasted even longer. The truck ran strong & got fantastic fuel mileage - 20 m.p.g. @ 75 m.p.h. empty and avg. of 13 to 15 m.p.g. towing anything I put behind it. AND I had just put the 3rd set of shocks on it, new steering stabilizer, brakes all around - originals on the rear & 2nd set on the front and had just replaced all the fluids right before I traded it in.

 

You can check on line to see what other Dodge dealers sell them for. I got my dealer to match the then on line price, this was 3 months after I bought mine for a 7/100 with $100. ded for $1995.00.

 

Yes, 3 additional years, so it works out to about 3 years and 64k more mile of additional bumper to bumper.

 

how many miles per year will you be putting on the truck. thats the other thing to look at. also will you have this same option in a year or two. that would give you time to see if you have a problem truck or not.

 

I suspect that I will have about 80-85k on the truck by the time the six years is up.

 

See my numbers above... even if you do have a breakdown that costs $2000 to fix, you'd be getting a total value of $129. If you purchased a warranty with a $100 deductible, the value of that warranty would be $29.

Is it worth spending $1900 for a 10% chance to make $29?

Put that money in the bank, in an account labeled "auto repair". I bet you'll have some left over by trade-in time. The biggest risk area for our trucks is the $13K engine, which is already covered up to 100K miles.