Is there ever a good reason to buy an extended warranty, like a used audi?


I’ve got an 05 audi a4 and I just dropped it off at the dealer for the third time since I’ve owned it in the last year. My warranty is about to run out, given it’s track record and the cost to fix this car… should I buy an extended warranty?

I’ve yet to see a valid reason to buy one. They are a waste of money. If the car is that bad, I’d sell it and buy something else.

In my humble opinion, extended warranties are a waste of money. With the wide variety of cars available, there has to be a reliable car you like. If a car is so unreliable that it needs an extended warranty, than it isn’t a car I would want.

In your case, however, you already own the car in question. It all depends on the cost of the extended warranty. You might come out ahead financially trading the car in for a reliable vehicle. You should do a financial analysis when you have found the costs of your alternatives.

I’d say the car is reliable, it’s just pain in the butt type things like a coil problem, o ring for the anti freeze, etc. I still feel safe driving it. It’s just so expensive to repair anything on these cars, I wonder if given the fact that this one seems to be a little fragile, it might make sense. Of course that could be these guys telling that to an unsuspecting girl that is weighing on me…

Those things you mentioned are trivial and should cost almost nothing to fix. The extended warranty will cost you a lot more then what’s been spent so far fixing it.

I guess if I stop bringing it to the dealership to be fixed (after the warranty runs out) then those things will get cheaper. The o ring was $200, central break light was $100 and I’m not sure what the coil is costing.

My answer still depends on the cost of the extended warranty and whether or not things like this would even be covered.

Your car does not sound like a problem child to me. The details on the car and the repairs are pretty skimpy with no mileage, maintenance history being given, etc, etc.

Coil problems can be caused by aged spark plugs, enviro conditions (driving through pooled rain water, etc.) so the fact the car has a coil problem does not mean the car itself is a clunker.
Regarding the O-ring, I have no idea of the story behind that but in most instances there is a story.

As to the extended warranty, they’re really not cost effective and with most warranty plans you’re going to get hit for a deductible on each complaint and repair. Add that in to the cost of the plan and it’s simply not worth it.

The problem with many of them (besides the certainty that they’ll cost more than you get back on average) is that many non-dealer warranties are worse than worthless, with denied claims and headaches the rule, rather than the exception. So the only one I would consider is an Audi factory extended warranty, but check to fine print to see what it really covers. They’re seldom ‘bumper to bumper’.

First I would only buy one if offered from Audi(company) not any third party. Third party’s have a bad rap and make collection difficult.

If it makes you more comfortable keeping a vehicle I think its well worth it vs the alternative of trading it off. A 2005 is in the very steep part of the depreciation curve and selling it vs keeping with or without ext warranty will cost you far far more. The longer you keep a vehicle the lower the depriciation over time cost is.

Remember depreciation is the most expensive part of bought brand new car ownership.

 Well any car can have major expensive repairs.  

The profit to the salesman and company is usually over 50%. So for every $1,000 you spend the insurance company has less than $500 to pay for repairs or they will loose money, something insurance companies do not do. Some people will get nothing back and some will get a lot more than they pay.  Most will get far less. In addition you need to keep in mind that the insurer has worded it to eliminate as many expensive things as they can.

Remember that the seller is out to make money and they get to write the rules and set the price.  They are not going to sell them at a loss so one way or another they are going to have you pay more than they will pay out.  

Would you gamble with a car dealer who gets to set all the rules and knows all the odds?   

Your decision has to do with the value of the piece of mind it gives you. If that is worth the cost then buy it. Don't expect it to cover everything however, most are written to keep cost down and exempt what they know will cost them money. 

Good Luck

Boy you guys are good. I really appreciate all of the advice and you were so quick! I’m heading back to the dealer today to pick up the car and I don’t even think I’ll talk to them about the warranty. It sounds like a bad idea in general. If something breaks, I’ll just be ready to fix it with the money that I was going to have to spend on the warranty itself and the deductibles and I’ll save some headaches as well. Thanks!

The other part of the puzzle is finding a reliable independent Audi mechanic, so you don’t have to pay dealer $$ for repair.