Certified pre-owned (CPO) sales in February rose to 191,860 units, up 15.3% from January’s 166,309, but down nearly 8.5% from February 2021, Cox Automotive reported March 11.
February’s CPO result is the highest since October 2021 and interrupts a six-month downward trend. CPO sales have been in decline since having strong sales in Q2 and Q3 of 2021.
New-Vehicle Shoppers Turn Into CPO Buyers
In 2021, the number of CPO buyers who were only shopping for a new vehicle at the start of their purchase journey increased by 226%, according to findings from the 2021 Cox Automotive Car Buyer Journey Study. Despite inventory frustrations, dealers delivered a great customer experience with 76% of CPO buyers indicating they were highly satisfied with their overall experience at the dealership/retailer where they purchased their vehicle.
Buyers identify five core values that influence their decision to buy a certified pre-owned vehicle:
- A CPO vehicle offers me peace of mind – 53%
- I trust CPO dealers more than I trust used-vehicle dealers – 41%
- A CPO vehicle is a better value than a new vehicle – 38%
- CPO allows me to buy a luxury vehicle in my price range – 35%
- CPO vehicles allow me to “trade up” or upgrade my current vehicle – 25%
“Certified pre-owned (CPO) programs can be a good way for consumers to bridge the gap between new and used vehicles,” said Brian Moody, executive editor, Autotrader. “Many shoppers want the security of a new car and the accompanying warranty but have been priced out of the market in certain segments. Used cars are often more affordable but lack the certainty of a new car warranty. CPO vehicles offer the best of both worlds, often with new car financing rates and warranties that extend up to 100,000 miles.”
A recent Autotrader article highlights some of the best CPO deals on 2017-2021 models. Many automakers offer deals and incentives to help attract buyers to their CPO programs – ranging from 0.99% APR financing for 36 months to 1.9% financing for 60 months.
Cox Automotive is forecasting a strong year for CPO at three million units, an increase year over year and above the record set in 2019. This forecast is supported by what is expected to be a record tax refund season and the attractiveness of certified pre-owned vehicles to consumers desiring like-new vehicles.