That is where dealerships make all their money. That's why the sales person is so nice! They have the easy job. The hard job is the financier who does all the hard selling. They make boat loads of money off extended warranties, tire warranties, gap insurance, scotch guard, ect. It's easy to add on some of these packages because, hey, it only adds 10-30 bucks a month onto my monthly payment! People don't realize how much these packages actually cost, since they only see the monthly payment increase.
When I bought my first used car, i was duped into buying a warranty. I was hard sold on it, and decided to go over the paperwork when I got home. I then realized how stupid I was for financing this. After I read what the warranty would actually cover, it pretty much boils down to NOTHING. Only things that are covered are parts that break due to manufacturer defect. Wear and tear is NOT covered! I called the dealership back up, yelled at them for selling me this shit, and they refunded me all the money, which i promptly used to pay back that part of the principal.
When we bought my wife's car, the a hole financier tried selling us Gap Insurance. She tried hard selling us with scare tatics. I did the math and pointed out to her that this only makes sense if you owe more than the car is worth, which we did NOT, and it would not cover an amount rolled over from a previous loan. She insisted it would, but I called her bluff, and showed her the fine print on the spot. She was not happy.
Bottom line, never trust dealership financiers, go to your credit union, or pay cash!