Car Buying

How Much More Does a CPO Car Cost?

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author photo by Doug DeMuro October 2014

If you're interested in buying a used car, then you might want to check out a vehicle with a certified pre-owned (CPO) warranty. Not only do CPO cars include a full dealership inspection, they usually come with a manufacturer-backed warranty that extends the original factory warranty by several years. Just how much more money should you expect to pay for a certified pre-owned vehicle compared to a standard used model? We have the answer.

How Much More?

To find out just how much more money you'll pay for a certified pre-owned vehicle than for a typical used model, we took to AutoTrader in order to research some asking prices. The first car that we checked out was the 2010 Audi A4, which is available for an average price of around $19,000 with no certified warranty. Add a certified warranty, and that number climbs to around $22,000 before taxes and the title.

To make sure that this wasn't an isolated phenomenon, we also considered another luxury model: the 2010 Lexus RX. Certified examples are available nationwide for an average price of around $30,300, while a sampling of noncertified used vehicles dropped that number to just $26,500.

We also checked out a nonluxury vehicle to make sure that the markup wasn't unique to the high end of the market. That vehicle was a 2010 Ford Taurus, which is available for an average price of around $18,100 with a Ford certified pre-owned warranty. When looking at only noncertified used cars, we discovered that the average dropped to around $15,900. As a result, we generally found that a certified pre-owned warranty has a big effect on prices -- often as much as 20 percent.

Why the Markup?

Interestingly, the certified pre-owned markup isn't entirely for the reasons you might think. Of course, the warranty itself plays some role. CPO vehicles carry a manufacturer-backed warranty, while run-of-the-mill used cars don't -- and that manufacturer-backed warranty isn't free. Rather, it's built into the cost of the vehicle, which makes certified cars a little more expensive.

There's another reason why CPO cars are often more expensive than their traditional used-car counterparts: They usually only offer the best quality. While a normal used car can have high miles or an accident history, manufacturers typically only offer certified pre-owned warranties on low-mile, accident-free vehicles. The result is that certified pre-owned cars don't just offer a warranty, but they also offer consistently high quality, which isn't always true of non-CPO vehicles.

Is It Worth It?

You'll have to decide for yourself whether or not a certified pre-owned vehicle is worth the premium. While you may not need to use the certified pre-owned warranty in some vehicles, it can be a lifesaver in others. It all comes down to the exact type of car that you choose -- and the exact markup over the relevant non-CPO vehicle.

This image is a stock photo and is not an exact representation of any vehicle offered for sale. Advertised vehicles of this model may have styling, trim levels, colors and optional equipment that differ from the stock photo.
How Much More Does a CPO Car Cost? - Autotrader