Certified Pre Owned Used Cars – What does CPO really mean?
Many car dealers offer Certified Pre Owned (“CPO") used cars on their lots. Each dealer touts various benefits of buying a CPO car. For example, that the car has been inspected, and has not been in a collision, or had major repairs, and the CPO car comes with an extended warranty of some type.
However, not all CPO cars are “equal." The CPO programs vary between manufacturers, and there is no “industry standard" definition of what “certified" really means. The consumer must still do their homework before deciding to buy a CPO car, especially since CPO cars sell at a premium price relative to the same year/make/model car that does not have the CPO “seal of approval."
There seems to be a recent trend that some cars that do not meet the manufacturer’s CPO requirements are being sold as “certified" when they should not be. I can only guess that the reason for this is that the DEALER and NOT the MANUFACTURER is responsible for inspecting the car (usually by going through an inspection checklist, provided by the manufacturer) and researching the vehicle’s history (i.e. CarFax, etc.) and the dealer’s service records. For example, Acura’s CPO literature states: “The Acura Dealership technicians also inspect all placements of the Vehicle Identification Number to ensure that the VIN plates match. In addition, the VIN is researched for open service campaigns."
It seems that there is little, if any, oversight my the manufacturer in the inspection process, the dealer knows it can sell the car for more money IF they can fill out the inspection forms so that the car meets the CPO requirements. It would seem that there is some incentive for the dealer to turn a blind eye to certain hard-to-find defects in the car that might disqualify it as a CPO, in order to be able to market it for the higher CPO price.
In a recent article by Chris Coffey published by the National Association of Consumer Advocates (“NACA"), several serious problems are identified with certain CPO cars that were bought by consumers. NACA believes that such problems are a growing trend in the marketplace for used cars. Read the full article here…
Coffey writes that: “Ford and GM certified pre-owned (CPO) programs advertise 172 point inspections, which include comprehensive checks of engines, brakes, and vehicle history reports. Toyota offers 160 point inspections on its CPOs. Honda (parent company of Acura) and Hyundai CPOs offer 150 point inspections. Chrysler CPOs come with 125 point inspections and Volkswagen CPOs must pass 112 point inspections. All of the previously mentioned CPO programs include vehicle history reports."
In my opinion, while the dealers tout the “hundred point" inspections that the cars go through as part of the “certification" process, I suspect that there is a great deal of “pencil-whipping" the inspection form (meaning the inspector rapidly checks-off the boxes).
Having seen some of the inspection forms used in CPO inspections, some of the numerous items on the form are in my opinion “fluff" to inflate the number of items “certified" and are of limited value to the consumer. For example, see the Acura 150 point CPO inspection checklist here…
For example, inspection of the seat upholsterly, carpets, and floormats. The condition of these items are obvious to the average consumer car buyer, and if those things “fail to perform according to the manufacturer’s specifications" they are not going to leave you stranded by the side of the highway, like a faulty transmission would. Dealer’s regularly clean/detail/repair/refurbish or replace these trim items, even on cars that are not CPO cars, in order to make them more marketable, and to hide what might otherwise appear to be excessive wear and tear to the car’s interior.