Hardison’s TIPS – April 22, 2021 – IS BUYING A CPO VEHICLE WORTH IT?

Hardison’s TIPS – April 22, 2021 – IS BUYING A CPO VEHICLE WORTH IT?

So, is the juice worth the squeeze? Consider the following:

CPO vehicles are relatively low-risk vehicles

Factories and dealers will only offer certified pre-owned status on late-model, low-mileage vehicles (ie, less than 5 years old and fewer than 80,000 miles). In many cases, CPO vehicles are young enough that they still have the basic manufacturer’s warranty. This means you are paying a premium for comprehensive protection on a vehicle that likely will not require enough repairs to justify that degree of coverage.

Sure, the comfort of a long-term comprehensive warranty is great, but is it worth the price of admission? Arguably, consumers may gain minimal benefit from CPO protection because they’re paying a premium for comprehensive coverage on a low risk car with original warranty remaining, but that depends on how much the consumer values the added peace of mind.

CPO vehicle options are restricted

Most cars more than four to six years old or that have more than 60,000 to 80,000 miles rarely qualify for CPO status. As such, customers shopping for older, higher mileage cars at lower price points may not have the CPO option available even though the peace of mind may be highly valuable given the added risk of that vehicle. So, while CPO status can provide some great protection, it is typically not available for a large segment of car buyers that would legitimately benefit from it.

Do Alternatives To CPO Vehicles Exist?

Fortunately, if you’re in the market for a vehicle and desire the CPO peace of mind, but you don’t want to pay the premium, you have alternatives that provide similar comfort and coverage at a more competitive price. Whether you’re in the market for an older vehicle that doesn’t qualify for CPO status or a newer model that does, you can replicate CPO coverage, usually at a cost well below the comparable CPO premium.

If that’s up your alley, your first step is to take the vehicle to an independent mechanic you trust for a thorough pre-purchase inspection, which typically cost $75-$125. Next, purchase an extended vehicle service contract that provides the terms and coverage most important to you. The cost of these contracts varies by provider, vehicle, and terms desired, but you can often find prices well below the comparable CPO warranty through independent dealerships, national auto lenders such as USAA, or your local bank or credit union.

As an example, CarLotz is a consignment store for used vehicles, and we often help our customers find a vehicle service contract that provides the coverage desired – from simple powertrain to comprehensive coverage. These often come at a 25-50% discount to comparable CPO coverage at traditional dealerships. The chart below highlights how much you can save by creating your own version of a CPO vehicle. You’ll see in this example that the addition of a mechanic check-up and a full coverage service contract enables you to save roughly $1,200 over the same car with a CPO sticker.

Whether Or Not You Choose CPO, Do Research And Find The Best Option For You!

Purchasing a car is a significant investment, and finding the best fit is critical. Take the time to consider what car fulfills your needs and what degree of warranty coverage, if any, works best for you.

CPO vehicles can be a great option for certain consumers, but as we’ve shown here, safety and coverage don’t have to come at a large premium. Finding the right car and the right protection for you is worth taking the time to check out options beyond only Certified Pre-Owned cars. A little extra investigation can yield some serious savings!

From his success on the sales floor of an automotive dealership  to becoming a veteran trainer and then the adoption of technology for Internet-based marketing, his career has evolved to deliver the skills and tools needed to help consumers. Richie Bello combined his automotive expertise with his robust desire to “take care of the customer first” to become an automotive influencer, published author, and renowned trainer.  Bello absorbed the wants and needs of consumers as he worked up the ladder of the automotive industry.

Over the thirty-five years of his career, he developed strong Internet marketing skills, leading him to developing software solutions that create ease for consumers, and helps dealers improve relationships with customers. Innovation drives success. And, for Bello, it’s in his DNA. took years to come to consumers and arrived in a timely manner, during the 2020 Pandemic. With over 6 million vehicles on the site, features that help consumers deliver, finance and warranty, Bello has met the retail digital age head on.

Bello also is founder of Richie Bello Institute of Leadership and Management, a 501C3 not for profit, dedicated to the recruitment, education and employment of veterans into the automotive industry. Visit


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