#CPO

( video and lyrics NSFW)

Once the domain of mainstream luxury brands, certified pre-owned programs are starting to filter down to mainstream brands…and apparently, to Bugatti as well.

In 2013, 3.2 million new cars and light trucks were leased in the U.S., an almost threefold increase from 2009. The 2014 Manheim Used Car Report, produced by one of the larger used vehicle auction companies, says that the auto industry will have to change the way it remarkets cars if it is going to successfully handle the increased volume of off-lease vehicles.

According to Automotive News, the Manheim report also warns that dealers who take in off-lease vehicles on behalf of lessors (so called ‘grounding’ dealers, “will not be willing or able to acquire the same large share of off-lease units that they have in recent years.”

“You can have any car you want. So long as it’s a Toyota or Honda.”

My parents had offered to split the costs of a new car with me back in 1994. That matching policy eventually included an awful lot of disclaimers and exclusions.

“No V8! No V6! No turbo! No stick! No convertible! No small car! No! Nein! Nyet!”

I eventually settled on a red Toyota Camry Coupe that served me well for 12 years and nearly 240k miles. It’s still on the road, which is funny because my brother, who had an equal bent on the Toyonda reliability supremacy, did something unusual recently.

He bought an Audi. Then he did something even stranger than that… he bought another.

Hi Sajeev,

I plan to by a Town and Country Touring-L within the next month (hat tip to Jack Baruth!). One vehicle is a 2012 with 41.1k miles, has the Certified Pre-Owned 7yr/100,000mi warranty and listed for $19.0k. The other is a 2011 with 43.3k miles w/o CPO listed for $17.0k. Both are otherwise almost identical.

My question is whether or not it the $2,000 is worth it for the CPO vehicle. The primary difference is another 2yrs to the warranty (actually, 3yrs b/c one is a 2011 and the other is a 2012), and mileage limit stays at 100kmi, but then again I’m thinking that $2,000 is a lot of repairs for a vehicle. Then again, the piece of mind is worth something to me, but is it worth $2,000?

First of all I wanted to thank you for your great blog, I read it daily. Now I recently have bought a 2010 Lexus RX 350 with 30K miles on the clock. the original warranty will expire this coming January, since I have bought the car I have put about 5K on it without any problems, now should I buy the extend warranty or not?

The car was a returned 3 year lease which I got a pretty good deal since the dealer was a family friend; at that time they quoted me $2000 for the 5 year 75K extended warranty.

Certified pre-owned vehicles are rapidly becoming the favored new car alternative in the marketplace.

Sales for March 2013 are up over 21% from March 2012 to 190,065 units. Sales for the quarter were nearly a half million units to 497,647. Up nearly 10% from a year ago.

Rodrigo writes:

Hello Sajeev,

I’m being offered a 2005 BMW 545i with 78,000 miles on the clock. Well-equipped with the sport package and manual transmission, it’s being offered at $18,000 (negotiable) by a co-worker’s family member who “wants to get rid of it quick so he can replace it with a new truck.” I’m told it’s been babied, but I’ll definitely be asking for service records and a chance to have it inspected by a German car indy mechanic that’s 3 blocks from my apartment.

Most folks aren’t into cars.

They do want advice though; which is tricky for the B&B. While auto enthusiasts like us seek the Coltranes and Metallicas of vehicular enjoyment. They prefer… well… Jimmy Buffett. A well executed car that makes them feel comfortable, has a touch of ‘fun’ at times (the non-enthusiast types of fun), and can go about the transport business for a good decade and change with the same tune and minimal fuss.

They want Maragaritaville without the DUI.

All the convertibles in the $40,000 to $60,000 range seek to attract this mainstream audience. Can the Lexus IS250c do it better? And if so, at what price?

I know that European vehicle snobbism is often frowned upon here, but I do love the look and feel of German cars better than any other. The downside seems to be maintenance costs, that they are simply not affordable to own.

I’m going to be looking for a car in about the $20-25k range, so my choice is between pretty dull new Japanese cars and a circa 2008 BMW 328i or Mercedes C300. Both of them seems to be really attractive cars, but of course the enthusiast crown always goes to the BMW.

What I’m wondering is if the Certified Pre-Owned (CPO) program might be the answer. I’m sure most of you already know this, but the general idea is that they inspect and recondition low mileage used cars, give them a comprehensive warranty and basically treat them like almost new vehicles. The Mercedes program is the best known, but BMW appears to be coming on strong with an offer of five years free maintenance. On paper that should mean nearly cost-free ownership save brakes and other wear items.