Used cars sell too fast to certify them
Americans bought more than 225,000 Certified Used Cars (CPOs) in September. That’s a two percent increase from August and a one percent increase from September of last year.
Sell too fast for certification
But the slight increase masks a surprising phenomenon. CPO sales could have been much higher, except maybe dealerships are selling used cars too quickly to get them through the certification process. This creates a unique buying opportunity for smart shoppers (more on this in a moment).
Kevin Chartier, Vice President of Manheim Consulting, explains: “In today’s market, everything sells out so fast and at such high prices, that I think in many cases dealerships sell cars before they sell. ‘have the chance to attract them to their stores. spend time refurbishing them to full CPO standards. “
Manheim Consulting and Kelley Blue Book share the same parent company, Cox Automotive.
A longer inspection process
A certified used car is a used car that has undergone an inspection process. Dealers check CPO cars more thoroughly than other used cars on their lots. CPO cars are generally sold with a warranty.
This added peace of mind makes CPO cars a kind of middle ground between new and used cars – protected against defects like a new car, but with the lower price of a used model.
Cars of all kinds in short supply
In 2021, however, a shortage of necessary parts slowed the production of new cars around the world. The resulting shortages have pushed prices to record highs – the average selling price of new cars has now set five consecutive monthly records. It will likely come up with a sixth when the final September figures are available.
These high prices have driven some buyers who would otherwise buy new cars from the used car market. The average selling price of a used car has increased by almost a quarter in just one year. At the end of August, he was approaching $ 26,000.
High prices are forcing some new car buyers to withdraw from the market altogether. They may soon be doing the same for used car buyers.
Are you considering an offer? Ask them to certify it
If you are in the market for a used car, it should be noted that many of the newer used cars that you will find on dealership lots would likely be sold as CPO cars under normal circumstances. If dealerships are rushing used cars to the sales pitch as fast as they can, skipping the CPO process, that means many of the best used cars are not certified right now. It is not because they would not qualify. This is because the dealership is in a hurry.
Before you deposit your money, consider asking the dealership to certify the car. If the dealer is satisfied that you are ready to buy the car, they may be willing to go the extra mile to inspect it. You are always better off with a guarantee.