Buy new or keep old


#1

Hi, I’m trying to decide whether to buy a new car or keep driving my 2003 Hyundai which has 55000 miles on it. It has a 100,000 mile warranty but to maintain the warranty I’ll need to put about $1200 into the car by 60000 miles. I’ll be retiring in the next 5 years. So, would it be better to get a new car now or stay with the Hyundai and ride out the warranty?


#2

$1,200 is MUCH less than it would cost to buy a new car. I’d keep driving the car at least until the warranty runs out at 100K miles.

By then things may look completely different. A lot can happen in five years. Don’t plan automotive things that far in advance.

Why does it need $1,200 worth of work? The only thing I can think of is a new timing belt, which does not cost anywhere near $1,200.


#3

A Hyundai with that little miles is still very “young”, and should not require any serious repairs for a long time. When you retire, you will probably only drive half as much per year. So you have a long ways to go till 100,000 miles comes around. Worse yet, if the warranty had a time limit, your $1200 will be totally wasted. I would just keep driving the car, and not even bother with the $1200 renewal. These extended warranties only work when you buy an item with questionably and unproven technology. Or if the manufacturer is desparate to sell their cars, like Chrysler in the 80s. But then the warranty is free! Your car does not fall into that category. Please read the fine print in your existing document as to what is NOT covered. For the next 65,000 miles you will likely need brakes (not covered), maybe a radiator ($500 max), hoses (not covered),tires (not covered) A/C service (not covered),battery (not covered), tuneup (not overed) and so on. The only items covered are those that normally don’t break!!! Dealers make huge profits on these warranties because:

  1. People move away and may not be near a dealer when somthing breaks
  2. Items covered normally do not fail
  3. The “claims ratio” is extremely low

I have kept track of our household items bought over the last 10 years and between the second and 5th year (the span covered by extended warranty), we had only $110 in repairs on 11 items that would have been covered, while the extended warranty coverage cost for these items would have been $1150!! Sears employees really push these warranties because the represent rich, easy commissions. You are not in business to make somebody rich by buying ineffective protection.


#4

to maintain the warranty I’ll need to put about $1200 into the car by 60000 miles.

What is the $1,200 for? Must it be done by the dealer? Is that the factory warranty or an insurance policy calling itself an extended warranty?

It would be my guess that the $1,200 is for maintenance items, like maybe a timing belt, and that certainly needs to be done warranty or not. That is maintenance just like changing oil or replacing worn tyres only more important.