What is a CPO Car? CPO Cars vs Used Cars
Many buyers are unsure of exactly what certified pre-owned (CPO) means and how it differs from a traditional used vehicle. Is CPO just a marketing term, or is there real value behind the label? In an attempt to provide some clarity, let’s take a look at some common questions consumers have regarding certified pre-owned vehicles.
The History of CPO Cars
Pioneered by luxury automakers Mercedes and Lexus in the 1990s, certified pre-owned (CPO) vehicles represent a middle ground alternative to buying a used or new vehicle. Certified pre-owned vehicles are more affordable than a new vehicle and offer increased peace of mind for many buyers when compared to buying a traditional used vehicle.
Typically, a CPO vehicle will be less than 5 years old, have fewer than 80,000 miles and will have been inspected by someone acting on behalf of the manufacturer (or factory), dealership, or an independent third-party. If the vehicle meets the proper criteria, the certifying party will label it as being certified pre-owned.
The Difference Between Used Cars & CPO Cars
Almost always, a certified pre-owned car will have undergone a 100+ point inspection by a highly qualified mechanic. Any worn parts that do not meet the certifying party’s standards will have been replaced or reconditioned and the vehicle will have often been returned to what is known as “like new” status. Many manufacturers or dealers provide additional warranty coverage on CPO vehicles as well.
Of course, there is also the possibility that a vehicle labeled as certified pre-owned needed very little, or even no reconditioning. A comparable used vehicle for sale may be of the same quality, yet could cost significantly less.
This is where peace of mind comes into play. When buying a CPO car, the consumer knows the vehicle has gone through a thorough inspection and has undergone any needed maintenance or reconditioning and is often backed by a warranty. Whereas a used car is normally not backed by a defined inspection process or a warranty offer. The onus of having a used vehicle inspected by a qualified mechanic is on the buyer.
Are There any National or Industry Standards for CPO Cars?
There are no national or industry standards required for a vehicle to be labeled as certified pre-owned. CPO vehicles will have undergone a thorough hands-on inspection by a qualified technician and will have been reconditioned to a standard defined by the certifying party.
Some certification programs are more thorough than others and many see a “pecking order” descending from manufacturer certified down to independent third-party certified. However, in practice, some independents may hold a vehicle to a higher standard when compared to a manufacturer. Other times, the opposite may be true.
CPO Cars in Review
The mixture of value and peace of mind leads many potential car buyers to certified pre-owned vehicles. If you are considering a CPO purchase, here are a few questions to ask:
- Did a manufacturer, dealership, or a third-party certify the vehicle and what criteria did the vehicle need to meet in order to gain the certified pre-owned label?
- Where and when was the certification done?
- What maintenance and/or reconditioning was done to the vehicle?
- How does this differ from the other used non-CPO vehicles for sale on your lot?
- Is the vehicle still covered under the original manufacturer warranty?
- Does the vehicle come with any sort of CPO warranty?