By on September 23, 2014

Honda CPO Civic HF

Honda and General Motors dealers beware: If you’re not strictly adhering to the rules laid out by the certified pre-owned overlords, you might find yourself suspended until conditions improve.

Automotive News reports Honda CPO manager Brian Butts and GM CPO chief Larry Pryg both said most of the dealerships under their watch properly administer their respective programs, but those who do not are temporarily suspended.

For Honda, those suspensions are part of why CPO sales are down in 2014; production cuts — and the subsequent low off-lease volumes — following the 2011 Tōhoku earthquake and tsunami account for the rest of the missing sales. Sales dropped 7 percent in comparison to 2013 to 186,248 units.

Meanwhile, GM’s program saw a 10 percent increase in sales through August compared to last year, with 255,077 units leaving the used lot.

As for how those programs are monitored, Honda uses third-party companies to certify compliance, while GM Certified sends out its own reps to visit dealerships one to four times annually; those who comply receive fewer visits.

Honda’s program, which is undergoing a makeover as of this writing, requires non-compliant dealers to submit a plan and work with field staff to be able to sell CPO vehicles again after the 90-day suspension is lifted. GM also removes non-compliant dealers from the program, though no length of time was stated by Pryg.

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38 Comments on “Honda, GM Cracking Down On Non-Compliant CPO Programs...”


  • avatar
    sportyaccordy

    Hopefully this will give us some breathing room in the used car market. Prices are nuts. A 2 year old car is basically brand new these days anyway, CPO or not

    • 0 avatar
      thesparrow

      Some dealers are pricing their 1-3 year old used vehicles the same as, or even more than, a brand new one just across the lot. I don’t care if its CPO, super clean, low miles, etc. – that’s just nuts.

      Average buyers are starting to figure out that CPO is just a marketing gimmick anyway, which is why Honda and GM are getting nervous and making a show of “laying down the law”. Yeah, right…

  • avatar
    CoastieLenn

    It’s also amazing to me how many dealerships don’t participate in the CPO programs. I would always rather purchase a CPO car over just a “normal” pre-owned from a mainline dealer.

    • 0 avatar
      brenschluss

      I bought my car CPO, and I still believe it was the best option. I received a car which was virtually indistinguishable from new, for around 6-7k less. I also bought the extended warranty and have come out even on that.

      It probably would have been even cheaper had it not been “certified,” but I do believe they’re at least making sure there are no glaring issues, while giving it a very good detailing.

      I’m sure seeking CPO could backfire, but it worked well for me.

    • 0 avatar
      Lorenzo

      Why would a dealer participate in a CPO program when prices are nuts and they can make money on used cars without it? They can always make money on the extended warranty, and a big clue for the buyer is if the extended warranty is “not available” for the car they’re looking at.

  • avatar
    CaptainObvious

    I hope Mazda follows suit. I looked at a “certified” car at a Mazda dealership only to be told it was really “pre-certified” and I would have to pay for the certification process and any repairs.
    Which I suppose is fine – but the price listed didn’t include those fees and the car had a big “Certified” sticker across the windshield. I contacted Mazda corporate and got the boilerplate response that all dealers are independently owned and operated, blah, blah, blah…

    • 0 avatar
      S197GT

      i also had a negative experience at a mazda dealer. mazda came out with a pretty nice CPO program last year. when i was looking at a cx-9 i didn’t see anything about it being “certified”. i was later told by my salesman it was “certified”. however, it wasn’t until i got to the finance guy that i discovered it was not MAZDA certified, just “certified” by the dealer which provided an extended powertrain warranty (which only extended it 40k miles and a year or two over the OEM powertrain warranty. it was not a bumper to bumper extended warranty offered through the mazda CPO program.

      i bought the car any way since i basically got it at wholesale and was everything i wanted. left a bad taste, though.

      • 0 avatar
        CaptainObvious

        I was looking at a Mazda6 and I walked out. I saw the car on-line – but when the price on-line goes from $11k to $13.5 due to “certification” and the cost of parts/labor it becomes apparent that it’s just a ploy to get people into the showroom.

    • 0 avatar
      HerrKaLeun

      If you as buyer are paying for the repairs, what is the point to pay for CPO?

      • 0 avatar
        CaptainObvious

        Exactly! A CPO car should cost more than a non-CPO car – but put that price out there and up-front.

      • 0 avatar
        28-Cars-Later

        I thought CPO came with some kind of warranty, it does not?

        • 0 avatar
          snakebit

          You need to have the dealer show you exactly what the warranty on your CPO car includes, how long it lasts for in miles and months, and what parts are included and what parts are NOT included. A typical CPO warranty starts when the original warranty expires, and doesn’t always include everything that was covered by the original(new car) warranty. The dealer should be able to show you, before your actual purchase, the CPO booklet and/or the CPO contract they’ll ask you to sign if you do go ahead and buy this car. All of this should be available to you prior to your committment, and terms of the warranty must be all spelled out, don’t just take the salesmans or sales managers word alone.

  • avatar
    FormerFF

    BMW needs to do the same. I visited United BMW in Northeast Atlanta, and it seemed that all they did for their CPO cars was to give them an indifferent clean up and put them on the lot.

    • 0 avatar
      snakebit

      The thing to do is go to the official BMWUSA site, look up the CPO program that they(the factory or distributor) administers, and then have the dealer show you if what they told you about is the official BMW program or something just this dealership is doing- ask them to show documentation. The BMW program is a fine way to get a better deal on a better BMW than you could afford new, but it should be the nationwide BMW CPO program, the dealer-created programs are meaningless.

    • 0 avatar
      SaulTigh

      My local BMW dealership has an itemized list of everything that was done to recondition the vehicle prior to selling it as a CPO. I think it’s pretty nifty and above board. Of course they’re owned by a dealer group that has a sterling rep that they’ve obviously earned.

      • 0 avatar
        cbrworm

        Mine too.

        For me, buying a preowned BMW is CPO only. I want that 100K warranty.

        On a Toyota, Honda, Nissan or Mazda, I don’t care about CPO as it is not likely to break, and if it does it, odds are it won’t cost me $4,000 to fix.

        If I were to buy a CPO program for a japanese car, I would want coverage to 150K.

        For GM cars, I’ve never kept one much beyond the warranty period. Not because of fear of repair, I just get tired of them more quickly. Or maybe in the past, when I used to buy GM cars, they felt more worn with less miles than a foreign car. I expect this is not the case today (hopefully).

    • 0 avatar
      MBella

      It depends on several factors, the manufacturer, the dealer, the person at the dealer in charge of administering the cpo, etc..

      I used to deal with a used car manager that wouldn’t do the cpo repairs until the car was sold. Then it was a rush to get it done. After he quit, it improved, and they were done before going to the lot. The dealer I work at now, even puts “this car is not yet for sale” stickers in the windshield until it gets done.

  • avatar
    kvndoom

    The 2010 Kia I just sold was CPO when I bought it… 150-point inspection!

    Amazingly the 150-points inspected didn’t include an open recall on the brake light switch, an oil pan leak, and a coolant leak. All fixed under warranty, but those problems never should have been present on the car when they put it up for sale.

    • 0 avatar
      DeadWeight

      lol. 150 point miss.

      • 0 avatar
        Lorenzo

        Heh. Ask to see those 150 points, and you’ll find they’re just boxes to be checked. 4 tires? check. No cracks in the windshield? check. Engine starts? check. Can be driven off the lot without 3 guys pushing it? check.

    • 0 avatar
      highdesertcat

      kvndoom, several states are trying to enact legislation that makes it illegal to sell a car until all the recalls have been addressed and documented by the selling party, dealer or private.

      I think in time it will come to pass, especially in light of the current GM ignition switch recall. But I also believe it is a toss-up between New York State and California which will pass and implement it first.

  • avatar
    Volt 230

    I’d rather buy an extended warranty than bother with this CPO, what is that anyway, so some tech checks the car and finds nothing wrong with it, you drive a few hundred miles and BAM and something breaks that was not broken before, with the warranty, it gets fixed, that is all.

  • avatar
    CaptainObvious

    I do believe that most CPO cars come with some sort of manufacturer warranty – not a dealership only warranty. That’s a big selling point.

  • avatar
    canddmeyer

    Hey GM, Kuni Chevrolet would be a good place to start. Signed, a former GM owner.

  • avatar
    Kendahl

    CPO implies that a competent mechanic has performed a detailed inspection of the vehicle and repaired everything that was bad or even close to bad. According to my trustworthy independent mechanic, the inspection is often cursory and repairs are limited to what has already failed. Post sale failures that should have been caught during the inspection are fixed under the extended warranty that is usually part of the CPO program. Done that way, a CPO vehicle is just another used car with an extended warranty you bought by paying a higher purchase price.

  • avatar
    mikey

    Last winter I made a complicated deal involving two trade ins. I was happy with the offer on the truck. It was my 2011 2SS Camaro with 9000 KLM’s {less than 6000 miles}, that was the sticking point. We were 500 dollars apart. The used car guy said “we have to do a multi point check on the Camaro before we can sell it”

    I called B.S. I said to the dude “you and I both know that when the Camaro comes out of my garage it goes straight to the front row of your used car lot”.

    Two days of haggling later , we split the difference. I drove the Camaro to their lot, it was on the front row that afternoon.

  • avatar
    redliner

    Reminds me of when I recently went to a local Toyota dealership to look at a low mile CPO car. When I got there, the pictures did not match the ones listed online, and the car had major body damage on the passenger side. The salesman said, “oh, don’t worry, it’s CPO, so after it comes out of the body shop it will have a great warranty.” I couldn’t believe they expected me to buy a “CPO” car that literally had thousands of dollars in body damage.

    • 0 avatar

      What disturbs me is that for every one of “us” who would be able to recognize and call out a dealership on a certain ploy or scam, there are twenty other people who are going to get utterly fleeced for the same thing, conned out of thousands of dollars. It’s disgusting.

      • 0 avatar
        CaptainObvious

        Yes it is.
        When I took the supposedly “certified” Mazda6 for a test drive I immediately noticed a vibration in the front end – probably just the tires needed to be rebalanced – when I mentioned it to the sales guy sitting next to me he said no way – the tires were new – and this stretch of road is just “wavy”.
        Well – I’ve been driving that road for more than 30 years in numerous cars and it’s not wavy and I told him so.
        BUT – How many people would just accept this statement as truth?

        • 0 avatar
          highdesertcat

          There’s an old axiom popular with dealers when taking in trades and that is, “if it ain’t broke, don’t fock with it!”

          The dealers have a detail crew to spruce up the looks and appeal of the car taken in, and they may even pop four new cheap tires on it, but “certification” is an urban myth.

          No new timing belt. No new Serpentine belt. Maybe an oil and filters change. Maybe topping off all fluids. But nothing that’s going to cost the dealership real money, if it doesn’t need it right then and there.

          When you buy that “certified pre-owned” vehicle you buy the certification that someone else previously owned it before you, and the extended warranty that’s folded into the transaction price, just in case something should break.

          • 0 avatar
            MBella

            As I’ve said before, I can’t talk about other manufacturers’ CPO programs, but a Mercedes CPO is very strict. We usually have to replace the tires with Mercedes approved versions. (The dealer can’t just put some GT Radials on it and call it good) The brakes have to be good. Every problem is required to be resolved. No body damage. They do spend a good chunk of money on most CPO cars.

          • 0 avatar
            highdesertcat

            MBella, I do not believe that the lesser brands hold themselves to the CPO standards of Mercedes, BMW or Lexus.

            Those are brands with cachet whose quality has endured over time and whose reputation has been established, and is worthy of protecting. The level of expectation is higher with those brands.

            When buying a CPO vehicle from Mercedes, BMW or Lexus the buyer generally gets a completely refurbished or reconditioned automobile.

            The lesser brands saw this sales-success as an opportunity to sell their used cars for a higher price but did little in return to refurbish the cars except maybe do a cursory once-over safety inspection.

            It’s easy to sell a used car as having been re-certified to be as-new and then furnish the buyer with an extended warranty, the cost of which has been folded into the transaction price, and the buyer pays for.

            And that could be the reason why several states are trying to enact legislation that makes it unlawful to sell any used vehicle until all recalls have been addressed and corrected, if need be.

          • 0 avatar
            snakebit

            Like MBella has posted for MB, my experience with Acura is similar. Tires that need replacement demand OEM Michelins or their current Michelin equivalent, because no car will be considered for CPO program if it has 100,000 or more miles things like timing belts are inspected but usually not replaced routinely, mainly because it’s typical that the car under CPO consideration has in the range of 40,000 to 70,000 miles and the suggested change interval is 90,000 miles. Doing an oil and filter change IS done routinely. A note about T belts and some Acuras. The manufacturer was gradually going back to using timing chains on cars like TSX and RSX rather than rubber timing belts.

      • 0 avatar
        snakebit

        Kyree, think about it.

        This is the internet age. Wouldn’t we hope that a buyer would do their research thoroughly via the web. What excuse does any car buyer have for failing to get the information they need to be educated about what to expect when buying a car? None, when they have a smart phone in their pocket, a Mac or PC at work, and maybe a laptop or tablet at home.

        It’s like someone taking the dealers word for something, not getting it in writing, and then getting angry when the dealer doesn’t come through, or denying that he promised you something. How many more decades will it take for a buyer to “get it in writing” first?

        Dealers are business people. They’re not your favorite nextdoor neighbor, they’re not saints, they’re not your best friend, their not family. If you’re pretending that they are any of these people, as Cher said, ‘snap out of it’.

        Buying a used car with a factory-administered extended warranty and under a factory-administered certified preowned program is generally a good deal for the public, I think, because it enables a buyer to afford a better model, while not the very latest one, for less money overall. And when the buyer perceives a problem, they have the weight of the factory, in the person of a consumer relations rep who themselves represent the car owner in negotiations against the dealer. This is why I keep saying that there is no reasonable thing as a dealer-administered preowned program. You always need written proof that the CPO-backed car you buy is one supported by the manufacturer.

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