Used Car Buyers Pay Happily for Peace of Mind

Certified pre-owned vehicles are an increasingly popular choice among US used-car buyers, according to the J.D. Power and Associates 2003 Used Vehicle Sales and Certification StudySM just released. Both sales and awareness of the scheme have grown despite competition from aggressive new-vehicle incentives.

The study measures the satisfaction and experiences of owners of late-model used vehicles that have undergone a dealership certification process. Sales of certified pre-owned (CPO) vehicles has increased to 38 percent of the used car market - up 3 per cent from 2002. Consumer awareness of CPO programs also continues to increase. Fifty-seven percent of all used-vehicle buyers are now familiar with the programs before beginning the shopping process, also a three per cent increase on last year.

The study finds that CPO buyers are more satisfied with their vehicles and the dealership sales experience than are non-certified buyers. In turn, CPO buyers indicate a much higher likelihood to return to the selling dealership for repairs, routine maintenance and future purchases. The direct cost of this reassurance is high: on average, CPO buyers paid nearly $3,000 more for their vehicle than non-CPO buyers where luxury cars were bought, and $1,000 more for non-luxury vehicles.

'The late-model used-vehicle market has been directly affected by the heavy use of incentives over the past two years as potential buyers are lured by the alternative of purchasing a new vehicle', said Todd Wilson, director of retail distribution research at J.D. Power and Associates, 'yet the market for certified pre-owned vehicles continues to grow. Without question, consumers rate the warranties that come with CPO vehicles as the most valuable feature of the programs, and they're willing to pay more for the added peace of mind'.

For the second year in a row, the Lexus certified pre-owned program ranks highest in customer satisfaction by a substantial margin. Lexus tops the industry in areas such as shopping experience and vehicle quality, as well as program features accompanying certification.

The 2003 Used Vehicle Sales and Certification Study measures the experiences of almost 16,000 used-vehicle owners who purchased their vehicles in late 2002. Bumper-to-bumper warranties, mechanical inspections, service plans and roadside assistance are some of the program features that were rated by consumers.

JD Power's Web site is at www.jdpower.com

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas unless otherwise stated.

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