Brand New Cars in Stock. Dealership Vehicles Lot. New Cars Market.
Last week, I discussed the trend of longer shelf life for registered vehicles in Canada. A closely related trend to that topic is the increase in popularity of pre-owned vehicles.
In 2000, pre-owned vehicle sales represented 56.6 per cent of the total market. By 2010, that figure had climbed to 65 per cent (2.9 million of the 4.4 million vehicles sold in Canada).
Pre-owned vehicles have become a hot commodity in Canada for several key reasons.
The most obvious reason is the improved engineering and quality of vehicles, which are far superior to vehicles built a generation ago. In the 1970s, the average passenger vehicle had a life expectancy of 177,000 kilometres; today, the average is 277,000 km.
When you buy a pre-owned vehicle in 2012, the general expectation is that it will operate without major problems for three to five years, or longer. Gone are the days when buying a used car meant you were buying someone else?s problems.
Over the past two decades, the stigma once attached to driving them has largely disappeared. Car owners are just as pleased and proud to purchase a pre-owned vehicle as they are a new car.
An important factor in buying a pre-owned vehicle is where you buy it. If you purchase a vehicle from a New Car Dealer registered with the Ontario Motor Vehicle Industry Council (OMVIC), your transaction is protected by the Motor Vehicle Compensation Fund. Buying privately means you lose out on that protection.
Another important factor is the peace of mind that comes from buying a car that carries the manufacturer?s seal of approval. Currently, 17 auto manufacturers in Canada offer certified pre-owned (CPO) programs that provide several benefits for buyers.
First, only vehicles with low mileage and clean histories are eligible for these programs; many vehicles don?t meet these stringent criteria and therefore do not earn CPO status.
Many CPO programs offer a multi-point inspection and a reconditioning process. The dealer will inspect hundreds of mechanical and safety items and repair or replace any deficient parts to give the vehicle a clean bill of health.
CPO programs also carry extended warranty protection, over and above the manufacturer?s basic and powertrain warranty. Not all manufacturers offer the same protection, so shoppers should compare several CPO programs before committing to buy.
A popular feature with CPO programs is 24-hour roadside assistance. This is a great feature to have if you ever run out of gas, lock your key inside or need to jump start your vehicle.
Some programs even allow buyers to exchange their vehicle within a certain time period if they aren?t satisfied with their purchase, and some offer free maintenance for a specified period.
Another benefit is the competitive lease and finance rates offered by manufacturers, which are often closely aligned with rates on new vehicles. Competitive rates have had a huge influence on the used-car market.
Most pre-owned vehicles offered under CPO programs are classified as lease-return vehicles. This is good news for buyers, as most of these vehicles have been properly serviced, according to the manufacturers? maintenance schedules.
As CPO programs have improved and become more prevalent, it is consumers who are the true winners. They are buying and leasing pre-owned cars and enjoying years of problem-free and stress-free driving.
For more information about CPO programs, visit the manufacturers? websites or contact your new-car dealer.
This column represents the view of TADA. Email [email protected] or visit tada.ca. Frank Romeo, president of the Trillium Automobile Dealers Association, is a new car dealer in the GTA.