Johnny Mayday

Certified Pre-Owned Programs are generally pretty cool, and Lexus just took home the number one ranking from US News & World Report. It's the first time they've done such a ranking, and it's an honor for Lexus, even if it's not a surprise. After all, Lexus makes some of the most reliable vehicles on the planet, so after the techs go over one that's been out in the wild, you can be pretty sure it'll be good as new. Has anyone used this program? If I were shopping, this is totally the way I'd go—if I didn't pull a Doug DeMuro and buy a breaky Rover with a CarMax warranty, ha ha! You can get the details here.

Johnny Mayday

Now I just want to go back and read all those RR posts. Ha ha!

Johnhav430

This is kind of ironic.....imagine being able to sell an extended warranty, on something that doesn't need one to begin with. Pretty slick marketing! Usually with German cars, people that purchase CPOs actually get something repaired under the CPO, which is unlikely with Lexus.

example--on my 1998 Nissan which I've owned since 1998, not one thing would have been repaired under a 5,6 or 12 yr. extended warranty. I purchased a 2006 LS430 with 81k, and not one thing would have been fixed in the last 13 1/2 mos. etc. It's like telling a 28 y.o. they can purchase term life insurance for less that $30/mo...

BrownPride

I saved nearly $4000 by buying my Lexus pre-owned from an Infiniti dealer rather than a CPO from the Lexus dealer down the street. The buying experience sucks in comparison, but come on, who needs CPO on a Lexus with 20K miles? These cars never have problems. It's a different story if you are buying a German car.

Aron9000

Agreed, you don't need to buy one of these things with the CPO warranty, they don't break. Hell even my 25 year old SC300 is running like a champ, over the past 5 years I've owned it I've spent less than $500 servicing the A/C and dealing with a problem with the clutch hydraulics.

Fizzboy7

Lexus CPO is a rip-off. But Lexus does it because customers expect to see some sort of special warranty on a used car and are willing to pay for it. In the end, the brand and dealer make a fortune off of this tactic.
Knowing all this ahead of time, we asked the dealer to remove the CPO off my mom's used RX350. They did and we saved several thousand right there, while still retaining the original factory warranty (why have a warranty ontop of a warranty?). Both of which will see very little use. After three years of ownership, the car has performed flawlessly, as expected. Great new cars make great used cars. Paying extra for any sort of (Lexus) warranty is throwing money in the trash can.

GSteg

iTrader: (15)

My CPO Lexus needed a new ABS actuator 4 months after I bought it. Would have been an additional $3k out of pocket. I didn't buy it for the CPO warranty though.. it just happen to come in handy in my case.

Johnhav430

that's common on bmws, happened to me. Would have been $4,100 at the dealer, I diy'd for $4xx. It's not that difficult but I needed the dealer software so had to buy it. Anyway, on the BMW forum, people have taken the same position as you, stating the CPO saved them 4 grand.

Here's the trick. On the BMW part, which is made in Hungary, there is a design flaw. So even though the dealer does the service, it fails again in the future. the part was replaced, the root cause was never eliminated. I wonder if that's the case with Lexus, or yours is an anomaly. That's why I had mine rebuilt in which they removed the design flaw. It's along the same lines where people usually say always rebuild your original starter, don't get a remanuf or new one...

What I'm trying to say is the best case is where you did not pay for a CPO, and you did not have anything fail...

JPG37027

Good award from US News on L/Certified LEXUS.

Note however the article remarks, "The Lexus CPO warranty includes coverage for up to two years..."

As of January, 2017, the L/Certified warranty for any LEXUS purchased certified with less than 50,000 miles and less than four years in service is much longer. The warranty period stretches to _six_ years from the date of first use. Our buyers regularly take home L/Certified LEXUS with warranties reaching into 2021.

mmarshall

IMO, there is still nothing like a brand-new car. Yes, Lexus CPOs are probably about as good as CPOs come from an actual auto manufacturer (Car Max, among independent used-car chains, also does a nice job). But, even then, from what I've actually seen on dealer lots, CPOs aren't always what they are cracked up to be.....occasionally, loose-fitting parts, body scratches, small dings, unbalanced wheels/tires, vibrating brakes, and other annoyances slip through the cracks. I think that part of the reason is simply the amount of sheer time and labor it takes to do the CPO process correctly. Lexus, for example, has some 160 different items on its official check-list (plus age/mileage limits) for an official CPO vehicle. Most, if not all, of that has to be done in the dealer's Service-Department. The Service Advisors and Technicians, most of the time, are busy just keeping up with the regular service/repair demands of the dealership's customers....they aren't likely to have a lot of extra time left over to inspect and/or replace all of those 160+ items on the checklist, trying to turn each CPO into a like-new cream-puff. So, the obvious temptation will be to cut corners....hopefully where the average customer won't notice. Plus, when these employees are tired and hungry at the end of a long working day, that's no time to be taking on extra projects......that's when errors and slip-ups can happen.

So...I'm not saying don't buy a CPO (or a Lexus CPO)...that's up to you, your money, and your priorities. Just be prepared to look it over and test-drive it carefully.......don't assume that it's a team-puff, just because of those initials on it.

Johnhav430

The myth of it all is that actuaries are pretty smart, you will never, ever, beat them overall. So CPOs are a feel good, as long as the price is buried (in this thread alone a person stated same car, $4k cheaper for a Lexus non-CPO). imho it matters more that's it's a bad business deal, when you are buying one on a reliable car. Then, the fact that CPO doesn't cover/excludes a lot (radiator hose bursts, motor overheats, CPO excludes)....also explains why my buddy bought a non CPO X5 from an authorized BMW dealership (he's a fund mgr. on Wall St. / CFA not a dumb guy)..

hey I'm no genius, I paid $3 for an extended warranty on an electric chain saw, and also $6 for an extended warranty on a humidifier (so many of these have gone bad I thought how can I lose)....got nothing out of them. Reminded me of the CT State Lottery motto as a kid: "You can't win, don't play."

mmarshall

Also, remember that the CPO process, on the average, adds several hundred $$$ to the KBB retail of the vehicle, partly due to the warranty, and partly due to the amount of time and labor involved in inspecting and reconditioning them (at least if they actually DO the inspection and reconditioning properly, as I addressed in my post just above). So, in some cases, for a CPO, you are paying almost as much as you would be for something brand-new. And, of course, if you are financing it, interest-rates from banks and other lenders often tend to be higher for used vehicles than for new ones.

Johnhav430

I wouldn't play that game either. You, as the buyer, are relying upon the seller to complete this process for you. So whether people actually pay it retail, is questionable. If I were a buyer or a seller, I would not rely upon KBB. That's like insisting the number zillow shows your house at is correct (it's inflated by 20-30%).

Another analogy, if someone offers to cash out your pension, do you do it? (hint: There are some cases where you agree to take less than it's worth, long story short, if it's a huge amount I believe over $5k/mo. and the co. is going under--for 90% of the people out there, you never accept the offer)

situman

If they truly think CPO's are all that, clearly they never used money from their own pocket.