What is a Certified Used Car

The term Certified Pre-Owned was coined in 1990 when Lexus and Mercedes-Benz were among the first to offer CPO programs. A pre-owned vehicle undergoes a complete inspection under the manufacturer's supervision at dozens or hundreds of points, worn and faulty parts are replaced and repaired, and the car receives an additional warranty.

If you decide whether to purchase a second-hand or a certified pre-owned car from a dealership, you will need to consider this question further. Unlike buying a car from a dealership, buying a pre-owned vehicle will save you money.

What Is a Pre-Owned Vehicle?

What is pre-owned: main advantages:

  • Extra equipment. It is customary for the first owner to fit the car with all the essentials like an alarm and a crankcase protector. Some owners have the car soundproofed.
  • The previous owner may give you a cool car radio, custom rims, and floor mats. If you're lucky, even a set of winter tires.
  • Corrected factory defects. The former owner probably fixed all factory defects in the used car under warranty from the official dealer. For example, a faulty thermostat.
  • Sometimes factory defects are really dangerous. For example, a defect in the accelerator pedal causes the used car to accelerate spontaneously. Toyota recalled more than four million cars in 2009 because of this defect.

The disadvantages of buying a certified pre-owned car:

  • Diagnostic and repair costs. The older the vehicle, the higher the maintenance costs, especially with high mileage. Many parts wear out over three years, and your used car breaks down more often.
  • Before you sign a sales agreement, have the sedan diagnosed at a car dealership. The cost of diagnosis is between 1,000 and 5,000 roubles, depending on the extent of the work.
  • If you buy a certified pre-owned car older than seven years, do not count on its trouble-free operation. Choose a two- or three-year-old used car, then you will not have to spend a fortune on repairs – it will be enough to change oil and brake pads.

What Is a Certified Pre-Owned Vehicle?

Of course, while buying, you should not neglect personal inspection and checking the history by VIN-code via online services like Carfax. But the chance of purchasing a quality car is higher if it is a certified CPO. Most brands exclusively certify their products, but some also work with third-party brands. The type of warranty service depends on the manufacturer: let's say Ford offers 12 months with a mileage limit, and Lexus offers two years regardless of mileage.

What is c.p.o: CPO cars are designed to occupy the price niche between new and conventional used cars. An additional aim of the programs is to attract buyers of new vehicles.

What to Expect from a CPO Car?

The auto industry hasn't adopted a unified certification standard, but all manufacturers’ main requirements are similar. As a rule, these are modern models up to five-six-seven years old with mileage in the region of 80,000 miles with a trouble-free history.

A suitable copy is checked by mechanics according to technical points: usually, they are more than a hundred, sometimes – several hundred, sometimes even 1000. In the latter case, it's more of a marketing ploy than a necessity because many inspection points will be insignificant and tell nothing about the real condition. There are requirements for each point in the manufacturer's program – parts not meeting the criteria are replaced or repaired by the dealer who certifies the car.

The terms and conditions of the warranty vary. A typical offer looks like one year from the date of purchase but within 12,000 miles of mileage over that period. If the original factory warranty period has not expired, the second owner may receive the remainder in addition to the term under the CPO program.

In addition to the basic bumper-to-bumper warranty, manufacturers may make longer service commitments on individual components and systems: powertrain, transmission, electrics, and air conditioning.

In general, a certified pre-owned car is more reliable than a hand-bought one. Nevertheless, a buyer should be careful: inspect the used car carefully before the deal and check its history through a specialized VIN decoder.

Pros and Cons of a Certified Pre-Owned Vehicle

  • Profitable price. You can buy a two or three-year-old car with the characteristics of a new model for 30-40% cheaper, this is the most significant advantage.
  • Buying expensive original parts to repair a used car is not necessary.
  • Servicing a used car is cheaper – it can be done at the dealership pre-owned cars or car service.
  • Often there are accessories from the first owner - mats, "music," alarm system, carter protection, noise isolation, seat covers, discs, set of tires, and sometimes even on the discs, etc.
  • There is no need for hull insurance (if there is no credit).
  • The increasing age of a certified pre-owned car reduces the risk of theft.

Certified Pre-Owned vs. Used Cars

Certified Pre-Owned Vehicles, referred to as CPOs, have passed a rigorous inspection and have been refurbished to look and feel like new but have already been broken in; they are less expensive than new but more expensive than used. As a general rule, CPO vehicles will be more reliable than used cars, which often need repair and regular servicing. But the level of reliability will depend on the quality of the check made by the manufacturer.

In the manufacture of cars now, there is a growing trend to offer CPO models that are in the middle between certified used and new vehicles. Their mileage is usually up to 50,000 miles and includes all available options which can be found on a new car.

How Does a Luxury CPO Program Work?

Like basic programs, luxury CPO programs can vary greatly from manufacturer to manufacturer. How a luxury CPO program works. To qualify for the Luxury CPO Program, a vehicle must be six years old or newer and have less than 75,000 miles driven. All used cars are inspected at more than 100 points. All items must be strictly adhered to. The only reason CPO programs exist is to increase the residual value to make leasing more attractive – luxury car manufacturers are in the business of leasing (not selling).

Are Certified Pre-Owned Cars Worth It?

Certified pre-owned cars are a good buy – but only if you're prepared to keep them for a long time. CPOs are often priced higher than used models, which makes sense. If you plan on keeping your new ride for more than four years, you'll enjoy the benefits of having a car ready to go at a bargain price.

In addition, many manufacturers offer attractive incentives with the purchase of a certified pre-owned vehicle. These may include extended warranties and available maintenance plans that help keep costs low over time.

Do you have to be the first owner of a certified pre-owned car?

No. While many certified pre-owned car dealers require that you be the vehicle's original owner, others will accept a trade-in from another dealer or a private sale. Also, it is not uncommon for people who own used cars to want to upgrade to a certified pre-owned model. However, when trading in your current vehicle for one still owned by the manufacturer, you may have to pay taxes on the value of the new vehicle's price reduction.

The Bottom Line

Certified pre-owned vehicles are a great deal to consumers. They offer warranty, reliability, and value without haggling a private seller or a used car lot. In most cases, purchasing a certified pre-owned car costs less than buying one new.

The CPO model is an option for those who just want to enjoy driving new cars and those who want to buy good quality cars with less money.

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