Opinion: What is a “5 Year” Warranty? It’s more than likely a gimmick.
Fact: Your local GM, Ford and Chrysler dealership offers a 3 year warranty if you purchase a remanufactured transmission.
Fact: Jasper Engines and Certified Transmission, two of the largest established transmission remanufacturers, offer a 3 year warranty on their transmissions.
Fact: All remanufactured transmissions sold at Autozone, Oreilly Auto Parts, Napa and Advance Auto Parts carry a 3 year warranty.
So if the dealership, the two largest transmission remanufacturers, and all the large auto parts stores offer a 3 year, what is a “5 year warranty” found online?
Why is the 5 Year Warranty a gimmick?
There is currently no company in existence that offers a 5 year warranty on transmissions that has been in business for over 5 years.
Companies below selling under a 5 year warranty have been in business less than 5 years (most 1-2 years), and most have far less than an “A” rating with the Better Business Bureau, yet they are offering a warranty online that exceeds the dealership and the industry standard, and usually at a lower price.
Note: There is one above company has been in business for over 5 years, but has a “F” rating with the BBB and is a salvage yard selling under a 5 year warranty. Here is another example that offered a 5 year warranty, then changed their name.
List of online companies selling transmissions under a 5 year warranty:
“Best Buy Transmission of Boca Raton, FL” – Same owner as AME Transmission of Deerfield Beach, FL, offering a 5 year warranty.
“AME Transmission of Deerfield Beach, FL” – Out of business. Same owner as Best Buy Transmission of Boca Raton, FL. Unanswered Complaints: The Better Business Bureau for AME Transmission shows unanswered complaints from customers in 2015-2017 requesting warranty service. Fine: The Florida Attorney General’s Consumer Protection Division on 3/30/2017 appeared to enter into a “Assurance of Voluntary Compliance” with the owner of AME Transmission regarding specifically in the document “refused to honor their five-year warranty”.
“Remanns.com” offers a 5 year warranty.
“ATransmissions.com / Got All Auto Parts of Bay City, MI” (Appears to be a Salvage Yard)
What are they doing?
First, you have to know what all of the above companies have in common:
None of them appear to remanufacture anything: These companies are more than likely selling another company’s transmissions. They operate out of a house, a small rented office space, or out of a salvage yard.
IE, they resell the transmissions of other established and reputable companies that offer a 3 year manufacturer warranty, they then add 2 years warranty at their own risk, and call it a 5 year warranty. These companies appear to have no actual financial plan (or, intention) of honoring it.
They gamble that they will not receive warranty claims after the 3 year manufacturer warranty is up. The customer takes the gamble the company will still be in business when the warranty is needed after the 3 year manufacturer warranty is up.
What happens after 3 years?
Every company who has sold under a 5 year warranty appears to be fine the first few years, then slowly starts to drain resources financially to cover warranty claim losses past year 3.
After those claims come in, they are highly likely to go out of business, start getting bad reviews, and often these companies, as in this example, change their name or go out of business entirely.
In a nutshell: Any company selling under a 5 year warranty will last 3-5 years at most, then will crumble financially, or their brand and reviews will suffer online due to not honoring the 5 year warranty, like in this example.
The main reason is pricing: The price of the transmission they are selling would have to be $300-$600 higher than current market pricing on reputable 3 year warranty transmissions, in order to cover the costs of warranty claims for the additional 2 years. Most of the above companies are selling for below market pricing, so there are no additional funds available to cover an additional 2 years of warranty.
Why do they do it?
By offering a 5 year warranty, versus a 3 year warranty found at reputable companies, these companies can make buyers believe they will have a 5 year warranty vs. a 3 year warranty at the same or lower price.
However, due to the above, any warranty claim a customer submits after 3 years has a higher chance of not being honored, mainly because the company offering the extra 2 years may not still be in business.
More than likely by the time a buyer realizes it after the 3 year period, it would be too late to make any claim.
Is State Licensing Required?
In many states, such as Florida, state licensing is required in order to offer extended warranties beyond what the manufacturer is offering because it is considered an “extended” warranty.
Recommendation
Buy from reputable, established companies that offer the industry standard 3 year warranty, at market pricing.
If you see a 5 year warranty online, buyer beware: Check online reviews. Check the BBB.
Examples
Example Video of a company that rebuild transmissions under a 5 year warranty, and outlines the financial difficulties
Transmission Suppliers List
Here is a list of current suppliers as of July 2019, with links to more information and the Better Business Bureau:
