09-23-2015, 08:59 AM
As of this past Saturday, I am no longer the F & I manager for a Honda-only dealership. The owner says it is "seasonal" but the truth is I had a couple of recent spats with the sales manager and one of the other owners about ethics. Obviously not a smart thing to do in a dealership! (Or to any boss, for that matter) But it's OK. I can go back to being retired, and they can go on doing what they do.
Honda's suggested retail pricing for warranties is exactly double the cost. If a CB1100 customer buys an extended warranty for their bike for the Honda-suggested price, Honda and the dealer each get half the money. If the amount is less than the suggested price, the dealer gets less, but Honda still gets paid the same. After all, Honda is the one that is providing the warranty work. If the price the customer agrees to is higher than "suggested", the dealer receives all of the additional price paid over suggested. Simply put, the amount Honda gets never changes. The dealer representative is trying to earn the most money for the dealership.
Someone has already provided the name of a dealership that will sell you a HONDA warranty online. I haven't investigated it closely, or purchased on myself through them, but I am 99.99999% certain it is the real deal. That's where I would go, or recommend my friends buy their warranty.
Someone wrote that they thought they couldn't cancel their warranty if purchased through financing the bike. Not true. Warranties can be canceled at any time and the funds will be disbursed to the lienholder if necessary. Cancelled warranties are refunded on a pro-rated basis. If the dealer tries to tack on a "cancellation fee", make them show you where you agreed in writing that they could.
As far as pricing, I think a 48-month extended warranty suggested price on a CB1100 is $799. If a dealer quoted you $1500, they were 1)lying through their teeth, and 2) going to pocket $1100 in profit with $400 going to Honda to pay for the warranty.
Honda warranty pricing is based on the engine not the type of bike...cruiser, standard, sport, etc. Dirt bikes aren't eligible.
The dealership where I worked paid me $10 per hour, and 5% of the dealer profit on an F & I product (loans and/or warranties or GAP) So...if I sold you an extended warranty on your CB1100 for $800, then I made $20, if they remembered to pay me. If I sold it to you for $600, then I only made $10, but you saved $200. It was an easy choice for me. I earned more in parts discounts than they paid me many months.
Honda's suggested retail pricing for warranties is exactly double the cost. If a CB1100 customer buys an extended warranty for their bike for the Honda-suggested price, Honda and the dealer each get half the money. If the amount is less than the suggested price, the dealer gets less, but Honda still gets paid the same. After all, Honda is the one that is providing the warranty work. If the price the customer agrees to is higher than "suggested", the dealer receives all of the additional price paid over suggested. Simply put, the amount Honda gets never changes. The dealer representative is trying to earn the most money for the dealership.
Someone has already provided the name of a dealership that will sell you a HONDA warranty online. I haven't investigated it closely, or purchased on myself through them, but I am 99.99999% certain it is the real deal. That's where I would go, or recommend my friends buy their warranty.
Someone wrote that they thought they couldn't cancel their warranty if purchased through financing the bike. Not true. Warranties can be canceled at any time and the funds will be disbursed to the lienholder if necessary. Cancelled warranties are refunded on a pro-rated basis. If the dealer tries to tack on a "cancellation fee", make them show you where you agreed in writing that they could.
As far as pricing, I think a 48-month extended warranty suggested price on a CB1100 is $799. If a dealer quoted you $1500, they were 1)lying through their teeth, and 2) going to pocket $1100 in profit with $400 going to Honda to pay for the warranty.
Honda warranty pricing is based on the engine not the type of bike...cruiser, standard, sport, etc. Dirt bikes aren't eligible.
The dealership where I worked paid me $10 per hour, and 5% of the dealer profit on an F & I product (loans and/or warranties or GAP) So...if I sold you an extended warranty on your CB1100 for $800, then I made $20, if they remembered to pay me. If I sold it to you for $600, then I only made $10, but you saved $200. It was an easy choice for me. I earned more in parts discounts than they paid me many months.
