In shocking news, the most popular vehicle bought at CarMax this year was not a Range Rover or a Mercedes E63 Wagon or some other wonderful piece of performance machinery that is long out of warranty and waiting to self-destruct at a moment's notice...it was the Nissan Altima.
Maybe this is not so surprising, from a sheer numbers perspective the Altima is one of the best selling sedans in the US; it is ranked 6th overall in sales according to GoodCarBadCar.net. So it makes sense that an incredibly popular sedan would also be very popular in the used car market. Other popular cars for CarMax are rather predictable as well such as the Ford F-150, Toyota Camry, and Honda Accord.
So CarMax for the most part sells boring cars. Why is any of this interesting? We have discussed before extended warranties and service plans. Doug DeMuro's posts have highlighted the benefit of such plans from CarMax. But Doug owns a Range Rover, those tend to break and break often, so he is getting his monies worth out of his CarMax warranty. The majority of the popular cars on the list above (with a few exceptions) have really solid reputations for reliability, which is part of the reason they are so popular. I also mentioned in a previous post that Consumer Reports revealed that most people that purchased an extended warranty either did not use it, or did not get the full value out of it. CarMax does not say how many of their vehicles are sold with their warranty, but for the sake of our discussion let's say it is only 25% (I bet it is more though).
Given the very low likelihood of that the popular vehicles listed above will suffer catastrophic failure, it stands to reason that CarMax is not too worried about the Doug DeMuros of the world. Does that mean that their warranty isn't worth it? Well, it all depends on what you buy...
(Altima image credit Wikipedia)
I'm Tom and I run AutomatchConsulting.com; I also write articles about car buying. If you have any questions about the car-buying process feel free to drop me a line in the comments or find me on Twitter @AutomatchTom and Facebook.com/AutomatchConsulting