Can a Mopar Extended Warranty Help You Beat Inflation?

[Zach@Granger]

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

Zach & Team

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[Samsons Wig]

I purchased through www.buymoparwarranty.com earlier this week. Jackie was extremely helpful and it couldn't have gone more smoothly. Happy to have it in place before the factory warranty runs out.

 

[Vtur]

To beat inflation is learn how to wrench or befriend with someone who does. Look for a neighbor that often works on their toys

 

[dmwphoto]

These extended warranty’s are a good value

 

[Nick6545]

Not after paying for the extended warranty, then being denied coverage and paying for the repair anyways.

 

[Vtur]

Not after paying for the extended warranty, then being denied coverage and paying for the repair anyways.

Amen brother! The time it takes to file a claim and possibility getting denied isn't worth it. Reading the fine prints is enough to get me giggles.

 

[loganjeeps]

In my experience this comes down to the dealer you work with and their appetite and experience pushing claims through (at least with mopar). I had a 2011 Grand Cherokee with the lifetime mopar warranty they pushed a lot through successfully for over 10 years after finding the right dealer to work with. On my JT I got the 7 year and they have gotten some really trivial things pushed through like a squeaky rear seatbelt. note i only have experience with the mopar warranty, not the third party ones.

 

[JTGuy]

In the past I did all my own repairs but on these new vehicles it's not really possible without the computer and the training. I only go with a factory extended warranty and plan on trading when my 7 year is over or before. There is just way too much electronic stuff on all the new cars that can fail.

 

[Zach@Granger]

To beat inflation is learn how to wrench or befriend with someone who does. Look for a neighbor that often works on their toys

That is a great piece of advice as well!

 

[Zach@Granger]

Not after paying for the extended warranty, then being denied coverage and paying for the repair anyways.

Sorry you had a bad experience. We've had very good luck with Mopar coverage and having a good relationship with your servicing dealer is a plus as well.

In the worlds of Jeeps, you do open up some risk if you are modifying your vehicle to a claim not being covered. Outside of that, we haven't had any issues.

 

[Redfour5]

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

Zach & Team

As to your main question, it's beyond inflation. If you have one and something breaks at 50K and is very expensive, you just beat the heck out of inflation and a severe lightening of your wallet. So yes in that case... But, like my Renegade with it, and 50K later, not a single thing went wrong except tires wearing out, NO.

 

[Silverator]

Not after paying for the extended warranty, then being denied coverage and paying for the repair anyways.

Yup. After getting the runaround, and sales job, and lying BS from my local and ONLY dealer about all the things that could void the warranty, I decided to forgo the Mopar lift, put in Clayton, and take my chances on the warranty. Everything from larger tires, to lift, to taser, to whatever can void your warranty. I was sick of WORRYING about protecting the warranty. They are only to make money for the seller anyway. At this point, I'll roll the dice, take my chances, and make my vehicle the way I want it to be.

PS - the BEST one : after telling me that 35's could void my warranty, 10 minutes later what is he trying to sell me? The buy 3 get the 4th for free tire sale on : yup - 35's.

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