Certified Pre-Owned

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A Certified Pre-Owned or CPO, car is a type of used car that has been mechanically certified. They typically include an extended warranty from the manufacturer, as well as enhanced finance rates. Luxury marques Lexus and Mercedes-Benz were among the first to create CPO programs in the 1990's, but today nearly every new car manufacturer offers some sort of used car certification program.

While there are many entities that can potentially declare a used car certified, the most common (and most reliable[1]) are cars certified by the manufacturer of the automobile. In most cases, in order for a vehicle to be certified it must be less than 5 years old, have less than 60k miles, and it must pass a thorough inspection. The inspection process, completed by the certifying dealer, typically includes[2]:

• A vehicle history check to ensure the vehicle has not been in an accident, been salvaged, or designated a "lemon" or manufacturer buyback.

• A check for open recalls.

• A verification that all scheduled maintenance, such as oil changes, transmission services, etc. has been performed.

• A visual inspection of all the major systems. The certifying technician is mostly looking for leaking seals and gaskets.

• All wear components, like tires, brake pads, and even windshield wipers, are inspected and replaced if needed.

• A visual inspection of the exterior for cosmetic flaws and, finally, a road test.

Upon successfully passing inspection, a used vehicle will be registered with the manufacturer and declared certified. Certification often enhances the standard factory warranty by adding both time and mileage to the basic warranty. Additionally, most manufacturers offered discounted financing rates[3] for certified pre-owned vehicles.

Certified pre-owned cars offer many benefits to consumers, dealers, and manufacturers. Consumers enjoy warranty coverage on their used vehicle that is often equivalent to purchasing a new vehicle, but for a lower price. Dealers can up-sell the certification feature. Finally, manufacturers can improve the resale value of their vehicles by offering a certified pre-owned program.

External Links

• What Are Certified Pre-Owned Vehicles?
• Article on Certified Pre-Owned vs. Extended Service Contract at edmunds.com - May have some further detail on this subject.