Are Factory Certified Pre-Owned Cars Worth the Extra Money?

Are Factory Certified Pre-Owned Cars Worth the Extra Money?

The used car market is booming these days. Given that the average cost of a new vehicle is in the mid-$30,000s in 2019, it's not surprising many buyers are opting to buy used to save some money. The latest Experian data tells us used car payments on average through the first quarter of 2019 are $391/month as opposed to $554/month for new vehicles. This brings us to Certified Pre-Owned vehicles. According to the Automotive News Data Center, CPO sales surpassed 2.7 million last year, an increase of 2.1 percent from 2017. So what exactly are CPO's and makes them so attractive despite the fact they are typically more expensive than non-CPO vehicles? Let's take a look.

 Certified Pre-Owned Vehicles (CPO)

Daily, I get the question of whether or not someone should buy a factory certified pre-owned car, and if it worth the extra money you pay for one. When I was the Ford National Dealer Council Chairman about 16 years ago, they asked me to help them come up with the best-certified program for consumers and dealers. It was a little foreign for an automaker to take an interest in selling used vehicles. This was ALL about resale value and ultimately residual values on leases. A couple of manufacturers were already big on certified pre-owned car (CPO) sales, and I looked for the best program out there. Much to my surprise, it was Jaguar's CPO program that at the time looked the best. Today, every manufacturer has a certified program, although some are better than others.

Certification Process

Over time, I have become a huge fan of Certified vehicles, and buy them myself when I need a personal vehicle. While most people focus on the long warranty that comes with a CPO vehicle, for me the process of certification is equally as important.

Although the programs vary by manufacturer, they all have processes by which the car goes through a rigorous checklist. Just about everything is checked to make sure it works and is in good order. Many of the programs require such things as new wiper blades, two working keys and remotes if the car is equipped with those, and they must also have a clean vehicle history. Management of the dealership has to sign a form saying all work was done.

Other perks of a Certified Pre-Owned car often include incentives such as low interest rates, roadside assistance, and a full tank of gas. In other words, it is as close to a new car as a used car can get, often for a fraction of the price of a new car.



Most CPO cars have the balance of a five or six-year warranty that extends to 100,000 miles. Some CPO warranties are now going to 120,000 miles, and some give unlimited mileage. Note that most of these warranties start from when the car was new. More on typical warranty terms here.


Price-wise, certified cars generally run more than non-certified cars, but the process the car goes through, the incentives associated with it, and most of all the warranty that is included make it all even out in the end. Best of all, you get the peace of mind of knowing the car was gone over with a fine-toothed comb.

Factory Programs

The only pitfall is to make sure the Certified Pre-Owned car you look at is part of a factory program. For instance, if you are looking at a Lexus CPO, make sure the dealer is part of the factory program, not his own certified program. Some dealers have tried that and gotten away with it. The only real certified cars are found at new car dealerships of the same brand. In other words, you can�t buy a factory certified Chevy at a Toyota dealership.

CPO Programs By Brand

All in all, I think factory certified vehicles make a ton of sense and there is little doubt they will save you money over the long haul. Links to CPO programs by brand are below.

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