Study: Certified-Pre-Owned Cars Not as Pricey as You Might Think
As used-car prices in May logged their largest percentage drop to date for 2015, many car shoppers may find themselves giving greater consideration to a pre-owned purchase. And as they do, the automotive researchers at iSeeCars.com want to challenge the notion that certified pre-owned vehicles have too high a premium attached to them versus other used vehicles.
“After analyzing 3.5 million used-car sales in an 18-month span, what we found was surprising: The average premium for CPO cars is only $722 compared with their non-certified counterparts,” iSeeCars.com reported, noting that CPO sales are off to a record start and are predicted to reach an all-time high this year.
Related: Used-Car Prices Down Nearly 2 Percent in May
While $722 is nothing to sneeze at, iSeeCars.com said some shopper misconceptions conjure sticker prices thousands of dollars higher for CPOs. The nine brands with the lowest CPO premiums compared with non-certified cars, as reported by iSeeCars.com’s study, cost just $289 to $447 more. For example, the study showed that car shoppers buying a certified Honda on average pay just 2.1 percent (or $380) more than they would for a non-certified car.
The brands with the nine lowest premiums for CPOs, followed by the average dollar figure and percentage, are:
1. Jeep, $289, 1.5 percent
2. Dodge, $346, 1.7 percent
3. Ram, $354, 1.2 percent
4. Subaru, $378, 1.9 percent
5. Honda, $380, 2.1 percent
6. Mazda, $403, 2.3 percent
7. Chrysler, $426, 2.8 percent
8. Chevrolet, $430, 2.1 percent
9. Buick, $447, 2.2 percent
Earlier this month, Cars.com reported that the average price for a late-model used car fell nearly 2 percent in May to $22,788, according to our vehicle listings data — $379 less than the previous month and the largest percentage drop year-to-date. As U.S. gas prices remain on an extended low streak, some of the greatest price dips have been for small, efficient vehicles, indicating elevated consumer confidence in cheap gas.
As non-certified used cars could come with uncertainties about their history and condition, CPOs can offer greater peace of mind that you’re not buying a lemon. With CPOs, automakers inspect and repair trade-ins before reselling them and then offer either a factory- or dealer-backed warranty, the latter often for an extra charge. Learn more about certified pre-owned vehicles here.
