Is an extended warranty on a brand new cummins diesel engine realy necessary or is this just a cash cow for the dealer?
Extended warranties do carry a high profit margin. But that doesnt mean you shouldnt get one ( doesn't mean you should either). Its insurance, and only you know what your tolerance for risk is.
I will say to read the fine print, since many extended warranties are pro-rated on a diminishing scale. For example 80-percent coverage first year, 60-percent teh next and 40-percent in the final year.
Hey, even if they just pick up 40 percent of a large repair, its likely to pay for the warranty. The question again is: What's your tolerance for risk.
A final note: If you think you will be selling or trading up withing the warantee period, a warrantteed engine can help boost resale value and also make a deal easier to close. Again, that's a question only you can answer.
Just do your homework, see what they cover, for how much, for how long, and who you have to do the repairs when you are away from your home dealer, and like Kevin said some are pro-rated and only cover so much after a certain time period, you usually have a time frame to make a decision to buy the extended warrenty, but with my experience on repairs, diesels can get VERY expensive, turbos start at $ 2,500 and go up, injectors pretty well the same, also when you resell it's a good tool to have, puts the buyers mind at ease,good luck :-)
Just like Kevin and Myles said "read the fine print". In my dealings with these companies in warranty work they can get picky to say the least. Most of the extended warranties I see 'DO NOT' transfer to a new owner, so again "read the fine print"