Can a Ford Protect Extended Warranty Help You Beat Inflation?

[Granger Ford]

It is not breaking news that prices are up on everything. Inflation has run high, and the federal reserve doesn’t think the battle is over yet to get inflation back down to 2%. One of the areas that has seen some of the biggest price increases is the automotive repair industry. The Federal Reserve Bank goes in detail to explain the reasons why, but it boils down to a tight workforce that is in high demand as well as a parts shortage.


I was curious to see how much that has affected our service department, so I pulled all our repair orders that were paid by an extended warranty company for 2 time periods (Jan-Apr 2020 and Jan-Apr 2024) to see how it has changed at our shop. Through the first 4 months of 2020 our average repair order covered by an extended warranty was $776, and in 2024? An eye-popping $1841! That is a 237% increase in 4 years. Admittedly we have a small sample size being only one dealership. But for the last 3 years, the federal reserve has registered a 5%, 13% and 8% rate of inflation for motor vehicle repair, well out-pacing overall CPI.

So what can be done to minimize the effects of repair inflation? One of the lesser talked about benefits of an extended warranty is that you are locking in tomorrow’s repairs at today’s repair prices. We work with both Mopar and Ford extended warranties and both of them have many actuaries that determine our cost for their plans. The feedback I’ve received from both manufacturers suggests prices will continue to rise in the future, because repair cost increases are well outpacing the reserves set up to cover them. Ford has scheduled a price increase in August of this year and Mopar just increased its prices in February and is considering doing it again.


I again was interested in seeing what increases we’ve seen over the last 2 years of selling service contracts and our average service contract price has increased 14%, much less than the 23% the CPI repair costs have increased at the same time. None of us can predict the future, but in the past inflation has proven to be sticky and takes longer than anticipated to get fully under control.


Another tool we’ve added to our websites is the ability to pay monthly. We realize increased prices have eaten away at monthly budgets and spending over $2000 on extended warranty coverage can be hard to budget for. So, we added a monthly payment option that allows our customers to pay for their warranty over an 18-month term. Our average monthly payment is taken automatically and comes out to less than $100/month.


You can find our coverage options for both Mopar and Ford on our websites.

www.buymoparwarranty.com
www.grangerfordextendedwarranty.com

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[Skandren]

Hmmm why am I seeing adds on this sight? oh yeah and I don't give a rats ass about mopar. I have a 8 year 75K service warranty from Ford on both of my Mavericks.

 

[paneubert]

Hmmm why am I seeing adds on this sight? oh yeah and I don't give a rats ass about mopar. I have a 8 year 75K service warranty from Ford on both of my Mavericks.

They are a financial sponsor of this forum, so they are able to post what ends up being an advertisement for their product. That is the reason companies sponsor forums like this one.

I hope you would agree that what they have posted here is worlds better and more informative information than what would normally be in an advertisement. They could have just said "Hey, buy warranty from us". But instead of just doing that, they provided a very informative and data driven post, so that people can make an informed decision about the product they are offering.

 

[JVolpe]

Hmmm why am I seeing adds on this sight? oh yeah and I don't give a rats ass about mopar. I have a 8 year 75K service warranty from Ford on both of my Mavericks.

Did you even read? Granger posted about and offers the Ford extended warranty

 

[pa-outdoorsman]

I have no issue with this post. An extended warranty is probably a good idea if you intend to keep your Maverick long term.

 

[DrNoobNStein]

I purchased mine thru Granger after the sale (the dealer sold me a 3rd party warranty). Cancelled as soon as I realized this, purchased thru Granger and saved $700. I guess shame on me for being so excited about buying Mavvy I didn't read everything I was signing

 

[null98115]

Hmmm why am I seeing adds on this sight? oh yeah and I don't give a rats ass about mopar. I have a 8 year 75K service warranty from Ford on both of my Mavericks.

I for one appreciate it. Lots of useful information in that post.

 

[WNYEscapee]

That's a great point being made. Yes, plans can cost your quite a bit of money, but the failure of one component can easily make that a money saving investment.

I've had techs in the shop state that they bought plans simply because while they can diagnose and repair their own vehicles, the cost of some of the parts alone could cost the price of the contract, and if they need to work on their own vehicles, why not have an insurance plan pay to do it.

Sure, I can get a discount on my parts and labor while working at a dealership, but it's not enough to offset the cost of an extended warranty plan should something major fail. Heck, even a couple electrical items could easily make that up.

I suggest anyone planning on keeping their vehicle consider one, unless you more than enough for such repairs readily available. Since new vehicles are more complex than ever, and yes, the claims of service costs skyrocketing are correct, it's well worth considering. And the Ford ESP plans offer some excellent coverage.

 

[FloodingdowninTX]

I love my truck. Low miles, it's a 22 Hybrid. Another thread or two have referenced the "half axle" on both the ecoboost and hybrid as being less than robust. At 5 years, in my case, this could be worthwhile since I have no intention to sell or trade in as long as the AC works and the truck runs. Is this an expensive part to replace relative to the warranty extension?

 

[1929]

Appreciate Granger on this site. One of the reasons I purchased warranty was to protect against future repair costs.

 

[ksc83]

$5700 for the maxed out with all the options warranty seems like a lot of money but one can also look at it like anything else, I'm hedging my bets. I've put 100k miles on 4 different Honda Pilot body styles in the course of 8 years and never had any issues. But that was a Honda and this is a Ford. I've watched my '22 F150 fall apart in front of my eyes and I've dropped some coin on keeping that thing running. Considering I will probably put 175k miles over the course of the next 2 to 3 years on my maverick, I'm not sure that the car will be able to survive like the Hondas did. So I can either spend the $5700 now and just have peace of mind or I can spend $2500 every time I take it to the local ford idiots and be pissed off. I have a feeling my maverick will have 5 or 6 visits for repairs which means that I'll end up spending less now than if I didn't get it. Stinks to spend the money but if my USA built F150 is falling apart, I cant imagine my Mexico built Maverick is going to make it to 200k miles. Thankfully with the current mileage reimbursement rates, by 175k miles, I'll have received enough to have paid for this maverick bought another Maverick, put the warranty on both and then plenty of extra money for accessories/tires/oil/etc.

 

[smpizza]

An ESP will minimize some inflation, but probably not all of it. It also depends on how much coverage you paid for, what the repair is, and if the shop interprets the coverage the same way you do. With auto prices becoming less affordable, it might make sense to think about future repair costs. However if you need a major repair, it might also make sense to cut your losses.

That being said, I do feel this post is a bit much, I already have an ESP from Granger through Maria. But I feel like this post is using scare tactics, the car you buy today may never need repair, it's impossible to tell. I do miss the days when cars were simpler and affordable. The only piece of mind you needed is remembering where you put your car keys.

 

[Hkak45]

I just want to say thank you to @Granger Ford for helping us members get the best price on the Ford ESP and also for giving below MSRP on Maverick and Bronco at times when every single other dealer was marking up. You are great people and my transaction with purchasing the ESP went perfect when I did it through your website. Thanks again for the information.

 

[pigsareus]

$5700 for the maxed out with all the options warranty seems like a lot of money but one can also look at it like anything else, I'm hedging my bets. I've put 100k miles on 4 different Honda Pilot body styles in the course of 8 years and never had any issues. But that was a Honda and this is a Ford. I've watched my '22 F150 fall apart in front of my eyes and I've dropped some coin on keeping that thing running. Considering I will probably put 175k miles over the course of the next 2 to 3 years on my maverick, I'm not sure that the car will be able to survive like the Hondas did. So I can either spend the $5700 now and just have peace of mind or I can spend $2500 every time I take it to the local ford idiots and be pissed off. I have a feeling my maverick will have 5 or 6 visits for repairs which means that I'll end up spending less now than if I didn't get it. Stinks to spend the money but if my USA built F150 is falling apart, I cant imagine my Mexico built Maverick is going to make it to 200k miles. Thankfully with the current mileage reimbursement rates, by 175k miles, I'll have received enough to have paid for this maverick bought another Maverick, put the warranty on both and then plenty of extra money for accessories/tires/oil/etc.

I'd think at $5700 the best option is to sell your used one that might have less than a year left on the 3 year warranty and buy something new. I have an offer from my dealer Xl hybrid where they'll give me $22,500 (more than the 21,500 I paid) to upgrade to a 2024 xl hybrid at 26,500, it'd be better to do that than to pony up for the 5700$ warranty.

 

[ksc83]

I'd think at $5700 the best option is to sell your used one that might have less than a year left on the 3 year warranty and buy something new. I have an offer from my dealer Xl hybrid where they'll give me $22,500 (more than the 21,500 I paid) to upgrade to a 2024 xl hybrid at 26,500, it'd be better to do that than to pony up for the 5700$ warranty.

If I could find something that was priced the same and had the same size and MPG, I would. But I’m getting Prius mileage with more space and at a lower cost although without that Toyota quality. Nothings perfect, you just try your best.

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