When is it worth buying a CPO Car?

One of the primary concerns for most consumers when buying a car is price. The lower sticker price of used and certified pre-owned (CPO) cars can be very attractive to buyers on a budget or for those looking to get a little extra value. However, to the average consumer, the differences between used and CPO may seem confusing. If both labels mean a car has been previously used, why can a CPO car cost thousands more than one labeled “used” and when is it worth it to buy a CPO car?

Used and CPO Explained

Traditionally, a used car is a vehicle that was previously owned or leased by someone else and is now for sale. Used cars often come "as-is" and with no guarantees or warranties outside of the possibility of a remaining original manufacturer warranty that is transferable. Due diligence to make sure the car is in good working order falls on the buyer, as once the car is purchased any defects or issues are normally solely the responsibility of the new owner.

A CPO car often comes with an extended warranty and the peace-of-mind of knowing that the vehicle went through a thorough multi-point inspection from certified mechanics that verified the car was in very good condition. Warranty coverage and the exact nature of a multi-point inspection will vary by manufacturer. It’s a good idea to ask a dealer for specifics and request a list so you know what was inspected and if any repairs or services were done on the car before it received its "certified" label.

An important note about CPO: Some dealers offer their own "certified" program. If a car is dealer certified it means that the dealer has certified it to its own unique standards which are often not as stringent as manufacturer standards and any warranties on a dealer certified vehicle will likely not be honored outside of the dealership where the vehicle is purchased. To ensure a higher standard and more broadly applicable warranty, look for cars that carry the manufacturer’s CPO label.

So, is it Worth it to Buy CPO?

In recent years, new car inventories have swollen to the highest levels in over a decade. The growth of new car inventories have created substantial pressure for dealers to sell vehicles at a fast pace. To achieve rapid sales goals, dealers are offering more discounts and purchase incentives on new vehicles which in-turn has created downward pressure on used and CPO prices. This is great news for consumers.

Given the current market conditions, it may very well be worth it to buy a CPO vehicle. Every case is unique, but there can be real dollar-for-dollar advantages to buying a CPO car. Generous manufacturer warranties and lower prices driven by persistent downward pressures has created substantial opportunities and significant benefits for savvy car buyers.