WHAT IS A CERTIFIED PRE-OWNED VEHICLE?

 

 

At Dallas Auto Center we’ve found that there’s a lot of confusion with shoppers about what makes a vehicle “Certified Pre-Owned,” or “CPO.”

We understand, it can be confusing trying to break it all down. From commercials, to magazine advertisements, there’s a lot of information out there.

 

We wanted to take a few minutes to explain what it is, what the benefits are, and the different types.

 

CERTIFIED PRE-OWNED:

A certified pre-owned vehicle is simply a used vehicle that has gone through a detailed inspection and comes with a limited warranty that extends past the original manufacturer’s warranty. Regardless of the type, it is NOT a total extension of the factory “bumper to bumper” or “comprehensive coverage” one has when purchasing a brand new vehicle. On every CPO program we’ve encountered, there are limitations and conditions.

 

THE BENEFITS:

A used vehicle is just that, it’s used. Cars and trucks today are complex machines that if well-cared for can provide years of enjoyable driving. The benefits of having a certified vehicle is that it will be inspected to ensure the previous owner took great care of it, and that when you purchase it you know exactly what you’re getting, and that it’s in great condition. It’s the closest you can get to purchasing a new vehicle while still saving a ton of money on the initial depreciation.

 

THE TYPES:

Manufacturer Certified

A manufacturer certified CPO vehicle is where the company who made the vehicle certifies it across their network of dealerships. So BMW, Audi, Mercedes, etc – will certify their vehicles according to their standards. They’ll typically extend the warranty 2 years past the in-service date (the date the vehicle was originally sold to the very first owner, or “put into service”) and extend the mileage out past the original duration, sometimes to 100,000 miles on certain components like the engine and transmission.  The CPO coverage allows the owner to take it to any dealership of that manufacturer, and have their vehicle repaired after paying a deductible (usually $50 to $100), provided the repair is covered by the warranty.

 

Independent Dealer Certified

An independent dealership can also certify a used vehicle. A dealership will often find a reputable third-party warranty company and work with them to create special plans of coverage for vehicles they sell to their customers. The dealer thoroughly inspects the vehicles before certification, and makes a determination based on mileage and overall condition if it meets their standards to be a CPO vehicle.  If so, it becomes a CPO vehicle with warranty options available. Depending on the dealer, a customer will have the option to not only have their vehicle repaired at a franchise dealership of their vehicle’s make, or any certified shop in their area.

 

So let’s break down some of the differences between the two.

 

 

Manufacturer CPO

Independent CPO

Which vehicles can be certified:

Manufacturers have strict guidelines on the age of vehicles. Often times exceptionally nice vehicles can not be certified just because they’re over a couple years old.

Independent dealers have a broader range of vehicles that can be certified. It’s not uncommon to find a low mileage vehicle that’s 3-4 years old with great certified coverage.

Deductible:

Usually between $50 and $100 per visit.

Can be as low as $0 and up to $100 or so depending on the specific coverage.

Where you can have a vehicle repaired:

Any dealership of that manufacturer. So a BMW can be repaired at any BMW dealership.

Any dealership of that manufacturer AND normally any independent repair facility with ASE trained technicians.

Duration and mileage:

Normally 2 years past the original in-service date with certain components out to 100k miles.

Plans vary with coverage starting at the inservice date, OR the date YOU purchased the vehicle. Plans can extend for several years and out to around 150,000 miles depending on the vehicle and coverage level.

What’s covered:

This depends on the manufacturer, but things like radio/stereo, speakers and navigation units are not covered.

Depends on the coverage, but generally speaking you can find a wide variety of coverage levels from basic to comprehensive.

Cost:

Typically manufacturer CPO vehicles are not always, but usually significantly more expensive.

Because of the flexibility in coverage an independent dealer has, they can provide great coverage options for almost any budget.

WHICH IS BETTER:

Only you can make the choice of which is better for your family, personally, I enjoy the freedom of being able to purchase a slightly older vehicle with great coverage, and the ability to take it to almost any independent repair facility for service.

 

If the used vehicle you’re considering is new enough, compare prices for CPO on local franchise/manufacturer dealer websites. Look at the specific coverage, and compare that to the coverage options and cost with an independent dealer. We think you’ll find a significant savings for comparable coverage.