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  • Factory Certified Pre-Owned Vehicles and Extended Warranties

    Factory Certified Pre-Owned Vehicles and Extended Warranties

    I talk about Certified Pre-Owned (CPO) vehicles on my radio show often. Simply put, I am a believer and have been since we first started hearing about these programs, which was in the late 1990s. When I was the Ford National Dealer Council Chairman in 2000-2003, Ford Motor asked us to study the CPO programs that were out there and come up with one the dealers would embrace.

    I traveled the country talking to dealers and used car managers until we came out with a program that everyone liked. Since that time, CPO programs have evolved and changed over the years and today, almost all manufacturers and dealers participate. In fact, if you look at CarProUSA.com today, there are 2,500 Certified Pre-Owned vehicles for sale.

    What Are The Advantages Of A Certified Vehicle?

    When talking about the benefits of factory Certified vehicles, I often talk about the process the vehicle must go through. This is a big benefit to make sure the vehicle is sound. Although it varies by brand, most certification programs call for checking between 150 and 200 different items, including tires. One thing that has evolved over time with CPO programs is the warranty that comes with your factory Certified car.

    Why Do Certified Cars Cost More?

    With a Certified vehicle, the dealer pays a fee to the manufacturer of the car, and this covers the long warranty that comes standard with a factory Certified vehicle. This is why it is important to check to make sure it is a factory Certified vehicle, not a vehicle deemed certified by a dealer or rental car company. Unless it is factory Certified, the Certified warranty is not good at every dealership in America that carries your brand. The other big cost factor is the cost of the vehicle passing the certification process. Some vehicles will have to have a set of tires, others will not. No two Certified vehicles will cost the same to certify.

    How Long Is The Typical CPO Warranty?

    Simply put, the warranty times can vary greatly and so can the mileage limits. It is important to note, too, that the warranty that comes with a Certified vehicle covers only the power train components, it is not bumper-to-bumper coverage. Also important: the time and/or mileage limits start from when the vehicle was new, not when you purchased it, so always ask your dealer for the original in-service date. They will have that information on their computer.

    I spent some time researching the major factory Certified programs, and I will run them down for you, so when you are considering the purchase of a Certified vehicle, you will know what to expect as far as the warranty goes.

      • 6-year/100,000 mile power train warranty on CPO vehicles: All General Motors brands, Audi, Lincoln, Porsche, Mitsubishi, and Toyota.
      • 7-year/100,000 mile power train warranty on CPO vehicles: Ford, Acura, all Chrysler brands, Honda, Jaguar, Land Rover, Mazda, Nissan, Subaru, and Volvo.
      • 6-year/75,000 mile power train warranty on CPO vehicles: Infiniti.
      • 10-year/100,000 mile power train warranty on CPO vehicles: Hyundai and Kia.
      • 1-year/unlimited mile power train warranty on CPO vehicles: BMW and Mercedes Benz.
      • 2-year/unlimited mile power train warranty on CPO vehicles: Lexus.
      • 2-year/24,000 mile power train warranty on CPO vehicles: Volkswagen

    What If I Want More Extensive Coverage?

    Most, if not all, automakers will offer more extensive coverage at a cost. As I covered, CPO warranties that are included with a CPO vehicle only cover essentially the engine, transmission, and drivetrain components. You can purchase more extensive coverage for things like air conditioning compressors, power steering pumps, master cylinders, etc. Usually, this coverage is not as expensive as even a new vehicle extended warranty since the power train coverage is already included.

    In Conclusion

    Personally, if I am buying a used vehicle, it will only be a factory Certified vehicle. Yes, you pay more, but I love the peace of mind of the certification process. I love that with almost all the CPO programs you get two keys and remotes, the car is washed, and overall it is as close to new as possible.

    Photo credit: welcomia/Shutterstock.com