Toyota Extended Warranty

[VandelayArt]

I just bought a new 2023 Sienna and the dealer quoted a 6 yr/75k warranty at $3.5k. I know extended warranties are a bad deal at the usual dealer pricing and never buy them. However, I reached out to some other dealers online that are known for selling them much closer to cost. I now have quotes for a 6 yr/75k for ~$1k (roughly 1/3 of the price from my local dealer) and 10 yr/100k for $1.9k.

At what point does Bogleheads think an extended warranty makes sense? Obviously it's worth something and it does seem that this is much closer to Toyota's cost, but I still struggle to get my head around spending $1.9k on a 10yr warranty.

[dukeblue219]

6 year 75k miles at $3.5k is highway robbery. New cars these days simply don't breakdown like 40 years ago. It's entirely likely a new Toyota will last 6 years and 75k miles with nothing but oil changes, a set or two of brake pads, and a set of tires.

The 10yr 100k would start to intrigue me but I'd still lean against personally. Probably not an awful deal financially if you need the warranty though.

[sport]

Do the warranties require that you get routine service at a Toyota dealer that may try to upsell their service? That would be additional cost compared to a good independent mechanic.

[StevieG72]

Waste of money, you are better off saving the money you would have spent on extended warranty for any repairs that pop up.

My 4-Runner has 70k miles and has needed a battery, brakes, and tires. Non of these items would be covered by warranty.

[MnD]

On my 2005 Tacoma, repairs that would have been covered by a 10 year extended warranty were $0.00
Only actual repairs (around 14-16 years) have been starter motor ($400 installed) and I DIY'd a gas cap and a radiator cap for around $50.

I tow, off-road and camp in remote high-elevation locations around 75 nights a year - so I'm not babying it.
Factory minimum scheduled maintenance at an independant Toyota only mechanic.

[notinuse]

The stated warranty term is not what you're paying for. Remember to subtract the standard 3 year/36000 mile bumper to bumper and the 5 year/60000 miles powertrain warranty. The net is what you're buying.
I wouldn't buy an extended warranty for any vehicle.

[runninginvestor]

The only time we have bought one was when we bought during the pandemic. Solely bc :

1. my wife said yes the same time I said no. Decided that I didn't want to test fate by overriding her and then having something break that would be covered.

2. figured that if there was any time to do it, it was while we had unprecedented supply chain issues on everything, including chips. I recall reading about several manufacturers delivering vehicles without USB hubs, and other parts.

For Toyota if you do get it, make sure you're getting the one that includes everything including electronics. I think that's the platinum coverage. and if you do, get the longest possible since it's covering the years behind the bumper to bumper, power train, and hybrid.

[Parkinglotracer]

I would read the actual extended warranty contract terms and conditions and see what they could guarantee on a dependable Toyota for 10 years that would be worth paying anything for. I’d bet there are as many things they don’t cover as they do cover. I own a Toyota (2014) and Lexus (2011) and Honda (2016) and I can’t remember what I have replaced other than things like brakes, rotors, tires, batteries, oil changes, cabin air / engine air filters, wind shield wipers and rusted muffler brackets - all pretty much normal wear and tear items I would think are not included in an extended warranty.

After all that I wouldn’t buy it. Make sure the company will be around for 10 years if the warranty is that long.

[OnTrack2020]

When we bought our new Sienna back over 10 years ago, we purchased an extended warranty. We ended up purchasing from some dealer in Kansas, I believe, that sold the warranty for much less than our local dealer. We ended up needing the fuel pump replaced at 60k miles. It was an absolute pain. The vehicle was in the shop for a week, and some adjuster had to come out from a larger city and approve the work. The cost of the warranty versus the cost of the work done basically ended up being a wash. I'm not sure we would ever buy one again.

[pizza8822]

If you plan to keep it for 10 full years, $1900 sounds like a decent price for 100k/10 years. The van cost you 40k right? I personally would consider paying $42k with a 'guarantee' the car will work properly for the duration of 10 years. But, it's up to you how much peace of mind matters. If you hate surprises, go for it. If you don't mind paying unexpected repairs, maybe risk it.

[Big Gun]

I bought a Sienna back in 2006, and the only mistake I made was being talked into that 75k extended warranty. IMHO, an absolute waste of money.

You’re buying a Toyota.

Toyota’s don’t breakdown, and if yours does, it’ll most likely be >100k when it needs a new water pump, timing chain or other maintenance.

We absolutely loved our Sienna, even though it ate tires (light truck chassis on passenger vehicle tires). Expect 50% of tire lifetime.

Sold it with 165k miles, and I’m sure it’s still running.

[student]

You don't need a warranty for a Toyota. However, I bought one for the Prius many years ago.

[VandelayArt]

Thanks, these were all helpful replies. My gut was against it from the beginning and I was only tempted due to the price, but you've all convinced me to skip it and roll the dice.

[tfunk]

We have owned three Toyotas. We bought them because they do not need an extended warranty. We kept our first Prius for 10 years. Not one single problem. We currently have two Prius Primes - 2018 and 2021. Not a single issue.

[Weathering]

Check with your car insurance. I just bought a new 2023 vehicle and when adding it to my GEICO policy it gave me the option of an extended warranty for $80/year. I have until the end of the first year of ownership (or 15k miles, whichever comes first) to add it to my policy. After that it cannot be purchased.

[BruDude]

$3.5k is like German car pricing, and the car already had a warranty if it’s new so you’re really only buying another 2-3 years. I’d honestly find that insulting. I just paid $1200 for an 8 year 85k bumper to bumper on a Jeep with the hemi engine which is more likely to break and more expensive to fix. On a Toyota I’d probably just skip it, even if something breaks it can’t be all that expensive. Odds of a major repair are pretty slim.

[Galt guy]

If it's not an extended warranty issued by Toyota, but by some third-party company, it could be worthless.

[Stinky]

Thanks, these were all helpful replies. My gut was against it from the beginning and I was only tempted due to the price, but you've all convinced me to skip it and roll the dice.

You're making a good decision in declining the warranty.

Also - you're not "rolling the dice" concerning vehicle reliability when you buy a Toyota.

[MangoMama]

I'm going against the BH majority here, but we bought a 10yr/100k platinum warranty from a Toyota dealer online for about $1500. We've had a bunch of issues all covered under the B2B warranty. But now at 42K miles and 5 years old, we had the thermostat just fail (not covered under power train). Reading online it requires loosing a motor mount and removing a bunch of accessories to access, with one person getting quotes in the $600-$800 range.

Dealer changed the thermostat under the warranty, but the tech ended up stripping the motor mount. It wasn't clear if it was the bolt or something else. Awaiting the new MM to come in while we have a loaner. Without the warranty, I wonder if we would've been on the hook for that too

So likely one more warranty repair and we'll break even easily.

[MangoMama]

Thanks, these were all helpful replies. My gut was against it from the beginning and I was only tempted due to the price, but you've all convinced me to skip it and roll the dice.

Also, you have until the 3yr/36k bumper to bumper warranty expires to purchase it. The only thing I wished it covered is the windshield gasket and window trim.

https://www.toyotafinancial.com/us/en/v ... ments.html

[8foot7]

The 10/100 captive warranty from the manufacturer for $1500 or under can tend to be a decent deal and not a rip-off. There are a lot of things that can happen in that ninth and tenth year. But you are likely just prepaying for it. Peace of mind can be worth something though.

My understanding is that the 10/100 from Toyota Financial (or American Honda, etc) costs the dealer about a grand. Everything you pay above that is pure markup on the dealer side.

[MangoMama]

The 10/100 captive warranty from the manufacturer for $1500 or under can tend to be a decent deal and not a rip-off. There are a lot of things that can happen in that ninth and tenth year. But you are likely just prepaying for it. Peace of mind can be worth something though.

My understanding is that the 10/100 from Toyota Financial (or American Honda, etc) costs the dealer about a grand. Everything you pay above that is pure markup on the dealer side.

Good to know. The warranty also includes towing to a dealer, roadside assistance, jumps, etc. So it's a no brainer for us since we do long trips with the Sienna and would've paid for AAA anyways for those 7 years outside of the b2b.

[runninginvestor]

The 10/100 captive warranty from the manufacturer for $1500 or under can tend to be a decent deal and not a rip-off. There are a lot of things that can happen in that ninth and tenth year. But you are likely just prepaying for it. Peace of mind can be worth something though.

My understanding is that the 10/100 from Toyota Financial (or American Honda, etc) costs the dealer about a grand. Everything you pay above that is pure markup on the dealer side.

Good to know. The warranty also includes towing to a dealer, roadside assistance, jumps, etc. So it's a no brainer for us since we do long trips with the Sienna and would've paid for AAA anyways for those 7 years outside of the b2b.

I'm in the minority here too. A $1,500/10 year warranty for a $40k vehicle is <4% of the purchase price and $150/year. With Toyota, that triples the bumper to bumper warranty. Which you might not use, but with the number of electrical components that can fail, I don't like rolling the dice. Since those can easily make up the cost. Especially since we keep our cars for 10+ years usually.

[ncbill]

Kid has had their 2019 Tacoma in the dealership on and off for the last several weeks.

There are apparently some cylinder issues with that engine.

I would absolutely buy that 10 year, 100,000 mile warranty for him were he not out of the original warranty period.

The longer powertrain warranty period is covering the above.

[j.click]

Everyone's experience is different. I purchased the Toyota factory 'platinum' extended warranty when purchasing my 3 year old CPO Lexus because one defect with all the electronics, chips and controls could easily exceed its cost. Already it has covered a new exhaust heat shield, radiator and water pump on my 10 yr old Lexus saving me more than I would have paid out of pocket and I have still have more time and mileage left under warranty. I doubt many Bogleheads have suffered through a house fire, but I bet 99%+ of us carry homeowner's insurance just in case.

[bob60014]

The house always wins!

[Katietsu]

The 10/100 captive warranty from the manufacturer for $1500 or under can tend to be a decent deal and not a rip-off. There are a lot of things that can happen in that ninth and tenth year. But you are likely just prepaying for it. Peace of mind can be worth something though.

My understanding is that the 10/100 from Toyota Financial (or American Honda, etc) costs the dealer about a grand. Everything you pay above that is pure markup on the dealer side.

Good to know. The warranty also includes towing to a dealer, roadside assistance, jumps, etc. So it's a no brainer for us since we do long trips with the Sienna and would've paid for AAA anyways for those 7 years outside of the b2b.

I'm in the minority here too. A $1,500/10 year warranty for a $40k vehicle is <4% of the purchase price and $150/year. With Toyota, that triples the bumper to bumper warranty. Which you might not use, but with the number of electrical components that can fail, I don't like rolling the dice. Since those can easily make up the cost. Especially since we keep our cars for 10+ years usually.

Not sure if you are in the minority. Just because it is a Toyota does not mean nothing will break. I know someone driving without a display on a not that old Toyota because it is more than that warranty price to replace it. I would probably wait until closer to the end of the manufacturer warranty to decide. Your needs might change or the car might unfortunately end up damaged by an accident.

[anoop]

The warranty the OP was quoted by first dealer was probably non-Toyota.
Pay close attention to what any warranty excludes.

In my case, the Acura extended warranty excludes the infotainment system (nav, radio, etc.) but I bought it anyway just because I wanted some coverage. I was hoping to buy a new car by now, but I'm just not able to get one in my choice of color.

Unfortunately, electronics are likely to be the weak part in these newer cars, so if that's excluded, the extended warranty will be of limited value.

In general, I wait until close to the end of factory warranty and then buy the extended only if I will be keeping the car.

[SpaghettiMonster]

The warranty the OP was quoted by first dealer was probably non-Toyota.
Pay close attention to what any warranty excludes.

It may very well be a Toyota-backed extended warranty. I purchased mine from a dealer mentioned frequently on a Sienna message board. For those times/mileage mentioned by the OP, he's selling them for:

6yr/75k $685
10yr/100k $1545

[anoop]

The warranty the OP was quoted by first dealer was probably non-Toyota.
Pay close attention to what any warranty excludes.

It may very well be a Toyota-backed extended warranty. I purchase mine from a dealer mentioned frequently on a Sienna message board. For those times/mileage mentioned by the OP, he's selling them for:

6yr/75k $685
10yr/100k $1545

Non-manufacturer "premium" warranties are often more expensive than manufacturer ones because they supposedly cover more. However, they are also less price transparent (hard to cross shop) and often over priced. But the argument from the dealer when selling those is usually "we have too much trouble getting payment from <manufacturer> hence we chose to offer this premium one".

Personally, I wouldn't buy a non-manufacturer one. My order of preference is:
- Get rid of the car before it's out of warranty. (Way too much electronics these days.)
- Get manufacturer extended warranty just before factory warranty expires. (Note the exclusions up front so you know your liabilities.)
- Run with no warranty and take chances.

In other words, I would rather run with no extended warranty than a non-manufacturer one.

[tarheel79]

Son in law bought an independent plan on used a Mercedes recommended by the dealer. Two years later after trying to file a claim found out the company was out of business. $3.5k down the drain.

[tarheel79]

Son in law bought an independent plan on used a Mercedes recommended by the dealer. Two years later after trying to file a claim found out the company was out of business. $3.5k down the drain.

[SpaghettiMonster]

The warranty the OP was quoted by first dealer was probably non-Toyota.
Pay close attention to what any warranty excludes.

It may very well be a Toyota-backed extended warranty. I purchase mine from a dealer mentioned frequently on a Sienna message board. For those times/mileage mentioned by the OP, he's selling them for:

6yr/75k $685
10yr/100k $1545

Non-manufacturer "premium" warranties are often more expensive than manufacturer ones because they supposedly cover more. However, they are also less price transparent (hard to cross shop) and often over priced. But the argument from the dealer when selling those is usually "we have too much trouble getting payment from <manufacturer> hence we chose to offer this premium one".

Personally, I wouldn't buy a non-manufacturer one. My order of preference is:
- Get rid of the car before it's out of warranty. (Way too much electronics these days.)
- Get manufacturer extended warranty just before factory warranty expires. (Note the exclusions up front so you know your liabilities.)
- Run with no warranty and take chances.

In other words, I would rather run with no extended warranty than a non-manufacturer one.

I agree, but these prices are for a manufacturer’s warranty, not a non-manufacturer one.

[Jack FFR1846]

According to some publications, the Jeep Wrangler is the MOST unreliable vehicle available in the US. I have a 2014 and have bought oil and filters thus far. If a Toyota really is at the top of the heap reliability wise, I'd expect you're going to find the same thing, but for maybe 25 years and a few hundred thousand miles.

[Rudedog]

We bought a 2007 Toyota Sienna, new, it now has 158,000 miles, my wife drives it and still loves it. We have had no "repairs" that would have been covered by an extended warranty.

[8foot7]

The house always wins!

I suppose you don't carry health, homeowners, or umbrella insurance either?

Don't get me wrong, many of these extended warranties are garbage, and not all insurance is created equal, and full disclosure, I just bought a new Honda Pilot but did not purchase the extended warranty; but I find reducing a risk analysis decision to simple tropes like the one you quoted unproductive.

[Sax32]

I just bought a new 2023 Sienna and the dealer quoted a 6 yr/75k warranty at $3.5k. I know extended warranties are a bad deal at the usual dealer pricing and never buy them. However, I reached out to some other dealers online that are known for selling them much closer to cost. I now have quotes for a 6 yr/75k for ~$1k (roughly 1/3 of the price from my local dealer) and 10 yr/100k for $1.9k.

At what point does Bogleheads think an extended warranty makes sense? Obviously it's worth something and it does seem that this is much closer to Toyota's cost, but I still struggle to get my head around spending $1.9k on a 10yr warranty.

From the math I've seen, is that if you can cover expenses with cash because you are doing well with money, then it doesn't make sense to get an extended warranty. If you wouldn't be able to come up with the cash to pay for repairs, then an extended warranty can make sense. Consumer reports April addition shows that Toyota and Lexus have the lowest repair rates of any other manufacturer, so you bought a good brand.

[Johny Fever]

All cars break, thank goodness because I owned auto repair businesses! However that number on a new Toyota is not a good deal at all. Personally I wont not buy anything that doesnt go to at least 100K and not spend more than 1500-1800. Now having said that all six of my kids or spouses drive Toyotas and there is not a warranty in the bunch. DW also drives a 2021 Sequoia and thats not warranty. My 76 LC is a little long in the tooth for warranty but it runs great..old, cold but great....I would pass or shop and ONLY ONLY ONLY ONLY ONLY buy a factory warranty from Toyota.

[Doctor Rhythm]

The house always wins!

I suppose you don't carry health, homeowners, or umbrella insurance either?

Don't get me wrong, many of these extended warranties are garbage, and not all insurance is created equal, and full disclosure, I just bought a new Honda Pilot but did not purchase the extended warranty; but I find reducing a risk analysis decision to simple tropes like the one you quoted unproductive.

I think bob60014’s comment meant the insurance or warranty company creates and operates a system that gives them a predictable financial advantage, leading to net gain for them and net loss for customers (as a population) — like a casino. As an individual customer or gambler, one might come out ahead but shouldn’t predict this to happen.

Your counter examples are for risks that one is unable to self-insure against. Unlike paying cash for a new starter motor (our last auto repair), I suspect most here cannot easily afford to pay cash for two years of cancer therapy or two weeks of hospitalization, or a $1M judgement in a personal injury suit. Homes are also quite expensive to repair and replace, but even if one wished to self-insure their home, the mortgage lender may require insurance.

[Helodriver]

2011 Tacoma nearly 200K miles. Spends more than half its life on dirt and gravel Also about 10% of its life towing.

Other than oil, filters, tires, brakes, battery and bulbs. (all not covered under warranties.) I had to replace a front wheel bearing assembly. Due to water intrusion from a stream crossing and a steering wheel spiral winding aka clock spring from dust dirt environment chaffing the winding. Neither of which would have been covered under the dealer warranty due to the type driving conditions I subject the vehicle to.

I knew from previous experience that "extreme conditions" or anything that would be considered "abuse" or "environmental damage" would not be covered under the extended warranty. So I didn't buy it.

I distinctly recall being offered a 7 year 100K extended warranty for $3,500. So with the bearing and the spiral winding I am still $2,400 ahead even though the warranty I was offered would have been long gone and would not have covered my problems.

Its a Toyota. Don't buy the warranty. Its pure profit for the dealer 99% of the time.

[Boglegrappler]

You have three years after you buy (length of the ordinary warranty) to make a decision on buying the extended coverage. I did that recently for a vehicle. My reasoning was that if I decide to sell it in the next two-three years, I will be able to transfer the coverage to the new buyer and they will have close to a new car warranty, which I think will at least break me even on the cost.

I don't expect the use of the warranty will pay for itself though. Toyotas don't break.

If you wait until the three year mark, you will have a better idea of which term of warranty makes the most sense for you. My mileage is so low that I was able to get a relatively cheap coverage for the 8 year period, which gives five years incrementally from the time I bought it. It really doesnt extend the power train coverage much, but, as someone else noted, it picks up electronics which can be expensive.

[TheRealJohnDoe]

First of all, be sure that the extended warranty is issued and backed by the manufacturer. The dealer will likely be selling a "Toyota extended warranty" meaning only that it is an extended warranty for a Toyota. Third party extended warranties are worthless. They are likely as not to be out of business when you go file a claim.

As to when you should buy an extended warranty for a vehicle, that would only be in the case where your livelihood is dependent on that vehicle and there is a reasonable chance that should an expensive repair be required, you'd be unable to have it done. That's it. If you believe that the expected cost of repairs after warranty expires on average on that vehicle is in excess of $3500, then why would you be buying that car?

[Carbiz]

If you can pick up the 10 yr/100K mile Platinum vehicle service contract backed by Toyota (Toyota Financial Services) for the $1545 (+/-) figure another poster mentioned, I would suggest you buy it (assuming you plan on keeping the vehicle that long.

My perspective is probably unique to most posters on this topic as I was in the car business for over 30 years. I became an ASE certified master technician after graduating with an Associate degree in Automotive Technology. My next job was as a service zone manager (factory rep) for Ford Motor Co. After 6 years I left Ford and switched to the retail side of the business and worked the retail (dealer) side of the business. After selling cars for almost 2 years, I worked as a service advisor and assistant service manager. The last 15 years or so, I was an F&I (finance manager) at Ford, Lincoln-Mercury and Lexus dealers. I was the person offering customers vehicle service contracts.

I know that vehicles (even Toyota and Lexus) can have breakdowns and need repairs and when they do, they can be very expensive. To illustrate this point, I had a binder with copies of actual service repair orders (with customer info redacted) so customers could see the cost of repairs.

Toyota makes a great vehicle. That being said, with all the technology and electronics on vehicles and with labor rates in the $150-$200 plus per hour range in Chicagoland, I buy the factory backed service contracts for my cars. I keep my cars a long time and maintain them according to the manufacturers schedule.

When I bought my new Subaru Outback 3 1/2 years ago, the dealer I bought the car from offered me the Subaru backed 10 year/100k mile service contract for $2500. Online, I found a Subaru dealer out East that sold me the same plan for around $1500.

I believe a factory backed service contract purchased for close to the dealer cost is worthwhile. It pays to shop around. Hope this helps.

[j.click]

Most helpful, thanks

[j.click]

A really eye-opener for me was several months ago when my RX350 needed a new water pump due to a bad bearing (well known and documented flaw). The first quote was out of pocket for about $1500. When I reminded my Service Advisor I held the Toyota/Lexus Platinum extended warranty the final bill (free to me) under warranty was about $700. Much like a medical bill, the in network or insured vs. out of network or uninsured was about a 1:2 ratio. I DID have the serpentine belt replaced at the same time since I was not charged labor, only the belt cost and I DID have the work performed at my Lexus dealer using OEM parts. More grist for the mill.....

[jharkin]

I just traded in my Tacoma at 9 years old. Never did anything but fluid changes and tires. It was even still on the original brake pads. Dealer bought it for about 65% of what I paid new in 2014.

I have had odd things happen on older Honda and Toyota's (we had an '08 pilot that developed a valvetrain tick at 120k) but not with anywhere near the frequency to make me think there is a positive ROI buying an extended warranty.

[MangoMama]

A really eye-opener for me was several months ago when my RX350 needed a new water pump due to a bad bearing (well known and documented flaw). The first quote was out of pocket for about $1500. When I reminded my Service Advisor I held the Toyota/Lexus Platinum extended warranty the final bill (free to me) under warranty was about $700. Much like a medical bill, the in network or insured vs. out of network or uninsured was about a 1:2 ratio. I DID have the serpentine belt replaced at the same time since I was not charged labor, only the belt cost and I DID have the work performed at my Lexus dealer using OEM parts. More grist for the mill.....

That's probably because the manufacturer only gives the dealer a fixed number of hours to do warranty repairs. Anything over that, the dealer (or tech) has to eat. For the thermostat change, the advisor mentioned Toyota gives them 2 hours.

[jharkin]

That's probably because the manufacturer only gives the dealer a fixed number of hours to do warranty repairs. Anything over that, the dealer (or tech) has to eat. For the thermostat change, the advisor mentioned Toyota gives them 2 hours.

Correct. They have a warranty repair schedule that specifies exactly how many hours of labor is paid per job. If they run into trouble or are short staffed and its takes longer the dealer eats it. But if the tech rushes and finishes fast I believe conversely they get paid the same the same rate = Unfortunately this could be seen as an incentive for careless work when its on the warranties dime....

[tdm757]

This link might be of interest:

https://www.reddit.com/r/rav4prime/comm ... anty_from/

"There are 2 main dealers (wolverine in MI and Greenfield in MA) that sell them at essentially invoice price. If you’re going to buy the Toyota branded extended warranty, buy through them."

I bought a 2017 Toyota RAV 4 new. Spouse puts limited miles on it, but just oil changes thus far. Toyota does not give me maintenance worries and we do not have a warranty. Maybe a newer untested model I would rethink that statement.