CPO Sales Continue to Roll

By Joe Overby, Staff Writer
February 09, 2009

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MONTVALE, N.J. — The certified pre-owned market carried its momentum from December into the New Year, proving to be a positive sign for the auto industry in an otherwise difficult environment.

The month was the best January on record for CPO sales, according to Autodata Corp, as the great majority of automakers showed gains.

Specifically, there were 140,803 CPO units sold during the month, and even though sales were off 4.3 percent from December, this marked a 10-percent upswing from a year ago, Autodata noted.

Hyundai and Subaru reached record certified highs, officials noted, with other automakers also showing strong gains.

Mercedes-Benz, for example, sold 6,753 certified units, an 86.3-percent improvement from a year ago and the brand's second-best CPO month on record.

Explaining how Mercedes-Benz has thrived, national pre-owned operations manager Mark Webster said the brand has strived to provide its customers with value.

"The current economic times creates an environment where people are even more focused on seeking value and thinking about making the right choice," he shared.

"Like Mercedes-Benz new cars, Mercedes-Benz Certified Pre-Owned offers value to customers," Webster continued. "Customers considering other manufacturers' new cars below the luxury segment are finding they can enter the luxury segment with a Mercedes-Benz CPO vehicle.

"Our dealers, our captive finance company Mercedes-Benz Financial and our pre-owned team at Mercedes-Benz USA are all working together to make Mercedes-Benz CPO vehicle a consideration for people considering other makes," he added.

At Toyota Certified Used Vehicles, "the sun was shining," pointed out sales operations manager Norm Olson.

The brand moved 20,714 units, a 1.4-percent upswing from a year ago and a January record.

"As the economy struggles, TCUV is surging ahead with strong support by our dealers. Customers that can't quite ‘fit' in the new Toyota of their choice are given the option of a Certified Toyota," Olson explained.

"Over 43 percent of our TCUV customers have never owned a Toyota before and, because of the value building warranty, roadside, inspection process, Carfax and the availability of new-car financing rates, their 'entry level' choice is easy," he continued. "Toyota Certified offers a substantial profit opportunity for our dealers and touches every department in the dealership in a positive way."

Meanwhile, Lexus moved 4,348 CPO units last month, a new January record and a 19.5-percent improvement from the same period in 2008.

"We're very pleased with the start of the New Year," noted Matt Kaleba, national certified pre-owned manager for Lexus. "Our dealers continue to do a great job promoting the value of certified pre-owned and utilizing the program to drive traffic into their showrooms."

Domestics also showed some strength in January.

Ford's combined CPO sales were 13,676 units, a 23.1-percent uptick from a year ago. By brand, Lincoln Mercury moved 1,873, compared to 1,535 the previous January. Ford sold 11,803 certified vehicles, a 23.3-percent climb.

"In a challenging market, Ford Motor Company delivered strong year-over-year CPO sales results in January," commented Glenn Burke, certified pre-owned manager for Ford.

"This is a testimonial to the hard work of the dealers, peace-of-mind customer attributes of the CPO program, and tremendous value a Ford CPO vehicle offers a customer," he added. "We believe these points will continue to resonate with consumers in this difficult economic environment."

General Motors improved, as well, selling a combined 39,293 certified units, up 4.3 percent from January 2008.

Breaking it down by brand, GM Certified Used Vehicles moved 33,695 CPO units, a 1-percent improvement from January 2008

Saturn was up 73 percent at 947 certified vehicles sold and Cadillac climbed 20 percent to 3,864 CPO models.

Next, Saab moved ahead 25 percent with 538 certified units sold, and Hummer increased certified sales 93 percent to 249 vehicles.

"The certified used-vehicle programs are starting the year strong despite the tight credit market and slowdowns in consumer spending and retail demand for both new and used vehicles," stated Mark LaNeve, vice president of GM North America vehicle sales, service and marketing.

"We continue to offer consumers the largest selection of certified vehicles and a worry-free purchasing experience that comes with one of the best warranties in the business and a factory-certified, 117-point fully inspected vehicle," he added.

Chrysler was the only one of the Big 3 to show a drop in certified sales, but it was a narrow one. Its CPO numbers fell 3.3 percent to 9,444 units.

By nameplate, Dodge sold 4,012 certified vehicles, compared with 4,222 a year ago. Jeep moved 2,836 CPO units, up from 2,429 in January 2008.

Chrysler sold 2,596 certified vehicles, versus 3,111 units the previous January.

Moving on, Nissan North America also had a strong CPO month, as its dealers posted certified sales of 6,714 units, its second-best month since 2007 and a 39-percent upswing from last year.

Its Infiniti division sold 1,056 CPO models, a 355-percent surge from a year ago, while the Nissan division reported 5,658 certified sales, a 23-percent improvement.

Neal Zirkle, senior manager of CPO/used-vehicle sales for Nissan and Infiniti, touted the help from the automaker's captive as a major reason for the success of its certified operations.

"Support from our captive finance company has been key to our retailers' sales success for both divisions, as third-party finance sources tighten or withdraw from financing used-vehicle purchases," Zirkle commented.

"Additionally, our retail network will continue to reap the benefits of higher gross profits on CPO sales along with higher retention of CPO customers for service and parts sales," he stated.

BMW, meanwhile, sold 10,007 certified vehicles, up 36.8 percent from the previous January.

In the company's overall sales report for January, BMW of North America president Jim O'Donnell discussed how its CPO operations have benefited the brand's overall operations.

"We're in a definite 'toughing it out' mode, and this has aided improving our market share this month," he noted.

"It's meant focusing on the real basics of making sales, and we've demonstrated this with our certified pre-owned program continuing to be embraced as a good alternative by our dealers and consumers in the current climate, and now we hope to add the momentum of the new 7 Series and Z4 coming out this spring," he added.

Moving on, Subaru closed January with 1,150 CPO units sold, compared with 577 a year ago.

"We are also pleased to see our CPO market share double from 0.4 percent last year to 0.8 percent this year," stated Jim Sarchese, national manager of Subaru Added Security.

Next, Volkswagen enjoyed improved certified in January, as well. It sold 3,806 CPO vehicles, up from 2,384 a year ago.

"We were very happy with our results and our VW CPO dealers continue to do a fantastic job promoting and selling our CPO vehicles," pointed out Rob Martin, CPO manager for VW sales operations.

Audi reported certified sales of 2,599 models, remaining steady from January 2008 when it sold 2,593 CPO units.

At Volvo, its dealers sold 2,340 CPO models in January, compared with 2,122 a year ago.

Among other automakers, Honda had CPO sales of 13,152 units, down from 16,039 in January 2008. Acura, however, was up 358 units from last year at 3,438 certified models sold.

Porsche remained static, as it sold 563 certified models, compared with 564 the previous year.

Hyundai sold 807 CPO vehicles, versus 608 a year ago. Kia sold 234 certified vehicles, compared with five in January 2008.

Over at Mazda, its dealers moved 399 certified vehicles, down from 424 in the same time frame of 2008. Mini sold 125 CPO units, up from 73 in January 2008.

Jaguar's CPO sales fell from 550 to 475 units, while Land Rover climbed slightly from 627 certified models to 650.

Mitsubishi was estimated to have sold 90 CPO units, down from 96 a year ago. Finally, Bentley's projected certified sales were 60 units, compared with 70 in 2008.

Used Car Manager