What's The Difference Between CPO And Used Cars?

A used car purchase can quite often be more involved than buying new. A brand-new car comes with zero miles on the clock and the peace-of-mind you get from the full manufacturer warranty. Used cars on the other hand are more of an unknown quantity and open the buyer up to any number of potential issues, right? Well, yes and no. While it is generally accepted that the older the car, the higher your chances are of being stranded at the side of the road in a cloud of smoke, if you go through the right channels the risks may be far lower than you might think.

Buying used gives you a lot more flexibility of where to source your car from too. We take a look at some of these options and see how they stack up to Certified Pre-Owned vehicles (CPOs).

Depending on the age of the used car you are looking at, you will have the option of buying from a private individual, general used car dealer or a manufacturer-certified franchised dealership. It does not take an automotive analyst to realize that a private sale will be the cheapest and riskiest option while a franchised dealership will be the inverse of that. As a vehicle gets older it trickles down through the official channels as it passes to each new owner, on through the less savory establishments in its later years until it is eventually sent off to the scrap heap. Our focus here is on the newer spectrum of the market but even here there are things to watch out for.

Buying a car from your friendly neighbor may seem tempting thanks to the generally attractive price but other than his solemn promise that it has been well-maintained and a few pieces of random paper to support this claim, you will be working mostly on his word. When it comes to after-sales backup, well, there isn't any. It is a risky but tempting method though, thanks to the usually low price, but if you are not the gambling sort you may end up gravitating to the safer waters of a dealership instead.

Used car dealers have a sometimes-undeserved reputation for being a tad shifty. If you are trawling through the murky waters of a car lot populated with starship-mileage decades old used cars, then there is a good chance that you will find a certain recalcitrance on the part of the dealer to compensate you when the transmission falls out onto the road. There is not much profit to be had in a $3,000 junker so if you are fishing in these waters, you get what you pay for.

The majority of smaller dealers fall into a slightly more respectable category, they tend to stock a variety of different makes and models that are often retailing for a few thousand dollars below what they would go for in a larger dealership or one with ties to a specific manufacturer. Independent dealers source their stock from car auctions, trade-ins and independent sellers, so the quality of the vehicles will be varied. There are some good deals to be had here but the downside is that they may not always come with a full service history, warranty or their mileages may be high for the specific model year. Picture credit: Transport Executive

Franchised car dealers will have a direct link with a specific motor manufacturer and tend to predominantly stock their models. These establishments will have professionally trained service staff and will only stock new or nearly new vehicles. The prices tend to be a bit higher than you would find from other outlets but you will benefit from the more exacting standards and procedures that franchised dealerships need to abide by. These dealers are also your only source of manufacturer certified pre-owned cars.

In essence, a CPO vehicle is the next best thing to buying the car brand new. The exact definition of what constitutes a certified pre-owned vehicle differs from manufacturer to manufacturer but they are generally no older than 6-years of age and have accumulated less than 85,000-miles during that time. The car will have gone through a multi-point checklist as outlined by the manufacturer and will come with an extended warranty. Other than avoiding the steep initial depreciation, you will also find that many CPO vehicles come with additional perks such as attractive lease deals, complementary servicing and roadside assistance too.

You can still get dealer certified vehicles from non-franchised dealers, however they do not come with manufacturer backing and there is no industry standard that the dealer has to abide by. This can result in widely varying standards across dealerships so a thorough examination of the fine print is vital to be certain of what is covered. As the certification is linked to the specific dealer, if they change hands or go out of business your warranty may become worthless. Going this route may still get you a great car, the risks are just slightly higher than with a CPO offering.

There are always good (and bad) deals to be had when buying used, the additional upfront costs of buying a CPO vehicle can often be worth it for the peace of mind you get from the manufacturer backing as well as the many perks that are generally not available through other channels. While they used to be reserved for luxury brands, CPOs are now commonplace across the motoring spectrum and just about every manufacturer offers them so it is definitely worth taking a look online at what stock is on offer. Buying used with a manufacturer warranty makes the process a lot less daunting than you might initially think.