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A Lifecycle Analysis:New Versus CPO Vehicles

Certified pre-owned vehicles (CPO) are pristine used units that offer the peace of mind of extended manufacturers' warranties. But will they save money for your fleet over buying new?

January 2009, by - Also by this author

It takes a down economy to rethink your business processes, though it's a healthy analysis in any economic climate. This evaluation should include your fleet: where in the acquisition, upkeep, routing and remarketing equation can you eke out extra savings?

In this issue we consider the value of used vehicles in your fleet. One article deals with leasing used vehicles. For this discussion the lifecycle cost experts at Vincentric performed a lifecycle analysis of new models versus certified pre-owned (CPO) models.

What Is CPO?

CPO vehicles are used vehicles that have been thoroughly inspected prior to sale and are backed by warranties that extend beyond the initial coverage. Manufacturer CPO vehicles are extra clean and are sold only at franchised dealers of that particular make. Therefore, they cost more than a non-CPO car of the same model and specifications. (The average additional cost per vehicle is around $1,100, according to a study by J.D. Power & Associates.)

Not all CPO programs are the same and will differ according to the inspection lists, warranties, title verification, availability of special financing, roadside assistance benefits and return/exchange policies.

With the service backing of your preferred fleet dealer and the peace of mind that a CPO warranty brings, is acquiring a CPO vehicle or two for fleet a smart investment?

Part 1 of chart

Part 2 of chart

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