Kia Motors America has now gone 16 straight months of certified pre-owned sales records, the company said Wednesday.
Kia moved 7,008 CPO units last month, which beat year-ago figures by 10.2 percent and was its best May ever, according to Autodata Corp.
Through five months of the year, there have been 33,414 Kia certified sales, good for a 13.2-percent increase.
“Certified pre-owned programs offer new-car like peace of mind to a wider spectrum of vehicle shoppers,” Karl Brauer — who is executive publisher of Autotrader, Dealer.com and Kelley Blue Book — said in a news release.
“While nearly every manufacturer has increased its CPO coverage in recent years, Kia’s program is clearly resonating with buyers who recognize the brand’s superb value equation,” he said.
Kia sold 76,224 certified vehicles in 2016, its best-ever sum, according to Autodata.
Maria Williams, Kia's senior CPO retail support manager, said earlier this year that Kia's certified sales have climbed each year since the program was launched in 2008, and the program is targeting another growth year in 2017.
As for May, the Kia models generating the most CPO sales were the Optima and (1,657) and Sorento (1,486), according to the automaker.
In addition to sessions on financing, regulatory moves, industry disruption and more, the NIADA Convention & Expo this week will include a host of certified pre-owned-related sessions.
The event, which began Monday and runs through Thursday, is being held at The Mirage in Las Vegas.
Among the CPO sessions are:
- "Winning the CPO Retail Battle vs. OEM Programs," featuring Joe Schumacher of CARFAX and Bill Carr of Warrantech (4:15 p.m. PT breakout session on Tuesday).
- "Success Tips of Independent Dealer CPO Pros." Panel moderated by Natalie Suarez of Warrantech; featuring panelists Frank Fuzy of Century Motors of South Florida, Todd Hoagey of Auction Direct USA, Billy Threadgill of Van’s Auto Sales and James Santistaven of Zia Motors. (9:45 a.m. breakout session on Wednesday)
- "State of the CPO Market Today and Tomorrow," with Tyson Jominy of J.D. Power (3:15 p.m. breakout session Wednesday.)
- "Millennials and Their Digital Tools: The Next Big CPO Market," featuring Marcus Dame of Cox Automotive and Roy Daves of eBay Motors (4:15 p.m. breakout session on Wednesday).
For a complete agenda, visit www.niadaconvention.com.
And be sure to catch members of the Used Car Week and Auto Remarketing team this week at booth #1825.
This month, automakers' certified pre-owned programs carry a number of attractive and competitive deals, including some Autotrader says are traditionally offered solely to new car buyers.
"If you're shopping on a budget, there are some great deals to be had among the many certified pre-owned offerings this month," Autotrader executive editor Brian Moody said in a news release. "When purchasing a CPO vehicle that has passed a strict inspection by the original manufacturer, you've made a smart decision on a vehicle with many trouble-free miles ahead."
Autotrader Editors' Top Picks for Certified Pre-Owned Deals for June
— Acura's certified pre-owned program touts excellent coverage this month, according to Autotrader. The brand offers 7 years or 100,000 miles of powertrain protection from the car's original sale date and an added year of comprehensive coverage. Also in June, qualified shoppers can get a certified pre-owned TLX, ILX or TL sedan with 1.49 percent interest for up to 36 months.
— Buick's certified pre-owned program offers both a "strong" incentive and a good deal typically only applied to new vehicles through the end of the month, the third-party car shopping site said. Qualified shoppers can get 1.9 percent interest for up to 36 months on any certified pre-owned Buick Enclave, Encore or LaCrosse — a good deal that typically only applies to new vehicles.
— This month, Chevrolet's certified pre-owned is offering qualified buyers interested in financing 1.9 percent interest for up to 36 months on any certified pre-owned Cruze, Equinox, Malibu, Silverado or Traverse models.
— Ford's certified pre-owned program offers qualified shoppers 1.9 percent interest for up to 66 months on certified pre-owned models of the Fusion midsize sedan, Escape compact crossover and Focus compact car through the end of the month. "That's a good rate over an unusually long period, especially for a used model," Autotrader said.
— Infiniti's certified pre-owned program offers coverage for up to 6 years on a number of models. The automaker is also offering one of the best CPO incentives currently available, according to Autotrader: Qualified shoppers can get 0.99 percent interest for up to 36 months on all certified pre-owned Infiniti models.
— Kia's certified pre-owned program is a favorite of Autotrader this month. In June, the automaker offers powertrain protection for up to 10 years or 100,000 and 1.9 percent interest for up to 36 months to qualified buyers on all certified pre-owned Kia models. "That's a great deal — and one you'd typically expect to only find on a new car," the car shopping site said.
— Subaru’s certified pre-owned program has introduced two notable benefits this month — no deductible, and full transferability to future owners. Also this month, the automaker is offering qualified buyers 1.49 percent interest for up to 36 months on all certified pre-owned models.
— Through the end of the month, Toyota's certified pre-owned program offers up to 7 years of powertrain protection from the original sale date, as well as an added year of bumper-to-bumper coverage. Qualified shoppers interested in a CPO RAV4 can get up to 1.9 percent interest for up to 60 months. This is a better deal than most other Toyota models, Autotrader said.
For additional information about the CPO programs named, visit http://www.autotrader.com/car-deals/cpo-deals-june-2017-266390.
If you have certified pre-owned units with alternative powertrains, the spring issue of Perspective from J.D. Power Valuation Services (formerly NADA Used Car Guide) offered some insight into why it might be difficult to turn that vehicle.
Before it became that CPO model, J.D. Power analysts explained that alternative segments generally have weaker demand and higher incentives than their gasoline-powered counterparts on the new side of the market.
“These two hindrances carry over directly to the used market, which means prices of used alternative powertrain models fall at much higher rates than for their gasoline counterparts,” analysts said in the report.
“The higher rate of depreciation means electric vehicles, plug-in hybrid and traditional hybrid retained value is frequently inferior to competitive gas models,” they continued.
Looking at the most recent 3-year-old retention figures by powertrain type (3-month average from March to May of this year), analysts noticed gasoline equipped models have retained at a rate of 52.1 percent, followed by hybrids at 46.4 percent.
Trailing much further behind, J.D. Power found that plugin hybrid and electric vehicle value retention reached 36.9 percent and 26.9 percent, respectively.
“Looking back, 2016 and 2015 retention results for the same period were similar. However, electric vehicle retention was more volatile because of new models being added,” analysts said in the report, which can be downloaded here.
Impact of fuel prices
J.D. Power also mentioned that what consumers are paying at the pump isn’t giving them much of an incentive to take that CPO unit off your store’s hands.
Analysis cited the forecast from the U.S. Energy Information Administration (EIA) that predicted fuel prices are expected to grow from roughly $2.30 per gallon in February to $2.51 per gallon in July before falling to $2.24 per gallon by December. Looking further out, the EIA expects prices to average $2.40 per gallon in 2018 and $2.44 per gallon in 2018.
“With average regular grade gas prices expected to remain around or under $2.50 per gallon in the U.S. over the short-term, there is little reason to believe that buyers who are sensitive to high gasoline expenses will be inclined to choose an alternative powertrain vehicle over a traditional gas-powered automobile due to the cost of fuel,” J.D. Power said in the report.
“However, it’s entirely possible that even with low gas prices expected in the coming years, some environmentally conscious consumers will continue to actively purchase electrics or plug-in hybrids,” analysts added.
Certified pre-owned sales climbed 7 percent last month and three brands reported best-ever sales, according to Autodata Corp.
The firm, which released industry-wide CPO numbers Friday morning, said in its report there were 237,445 certified sales in May, beating the 221,936 sales a year ago by 7 percent.
Through five months of the year, there have been 1.12 million CPO sales, up 1.6 percent year-over-year.
Cadillac, Mitsubishi and Subaru each posted their best-ever month for certified sales, according to Autodata.
Cadillac sold 4,205 CPO vehicles for a 48.6-percent year-over-year gain, Mitsubishi moved 144 certified units (up 132.3 percent) and Subaru had 6,450 CPO sales (up 22.9 percent).
Domestic brands combined to sell 83,272 certified vehicles for the month (up 10.4 percent). Through May, they have sold 383,688 units, which is down 3.1 percent from the prior-year period.
Asian brands were up 4.3 percent in May with 113,455 CPO sales, and they have sold 546,477 certified vehicles through five months (up 3.7 percent).
European brands sold 40,718 CPO units for the month (up 7.7 percent).
They have sold 189,207 year-to-date (up 6 percent).
A new survey from CarGurus reveals that the first car buying experience of millennials starkly differs from that of previous generations.
Compared to millennials, baby boomers were not only found to have been more involved when selecting their first car, but were also far more likely to have contributed to the purchase cost, the online automotive shopping platform said.
While only 37 percent of millennials surveyed said they contributed to the cost of their first car, 65 percent of baby boomers told CarGurus they paid for some or all of their first car, according to the survey. And 53 percent of Gen Xers contributed to the cost of their first car.
“Our data shows a clear generational shift in the dynamics of first car purchase,” said Sarah Welch, senior vice president of consumer marketing, said in a news release. “Given the rise of autonomous vehicles, ride sharing and sweeping urbanization, it will be interesting to see if future generations show the same trend in parents controlling the first car purchase or if we’ll see a drop-off in dependents needing a car at a younger age.”
Twenty-three percent of millennials’ first cars were hand-me-downs, while only 10 percent of baby boomers were, according to the survey.
The survey also found that millennials were more likely to receive their first car from a family member, and were just as likely to not have a choice. Thirty-four percent of the millennials surveyed said they were given their first car for either school, a job or extracurricular activity.
Thirty-three percent of millennials did not have a say in their first car, as opposed to 24 percent of baby boomers.
Although the survey shows clear differences in first car buying experiences between generations, it presents a few similarities, as well.
The survey found that 83 percent of all first cars were either bought or given used and 55 percent of drivers got their first car between the ages of 16 and 18.
Additionally, the survey also asked participants to name their favorite car brands. Chevrolet is the only brand to top each generation’s list of favorite brands. The overall most popular brands amongst all the drivers surveyed are Ford, Chevrolet, Toyota, Honda and Dodge, respectively.
The following are lists of the top five brands for each generation.
Baby boomers: Most popular first-car brands
- Ford
- Chevrolet
- Volkswagen
- Plymouth
- Toyota
Generation X: Most popular first-car brands
- Ford
- Chevrolet
- Toyota
- Dodge
- Pontiac
Millennials: Most popular-first car brands
- Chevrolet
- Honda
- Toyota
- Ford
- Nissan
CarGurus said it conducted the online survey of more than 1,800 randomly selected participants last month. Survey participants included drivers who have owned a car, ranging from 18 years of age to 70.
While quality and affordability are regarded as key decision factors when purchasing a car, America’s growing group of millennial consumers are most likely to consider brands that fit with their personal image instead, according to Cambridge Analytica, a data analytics and behavioral communications provider
“Finding brands which fit their personal image was the largest growing factor amongst millennials when compared to older respondents,” Cambridge Analytica Data Scientist Tom Richardson said via email when Auto Remarketing asked about the study’s findings.
Fitting personal image was found to be the largest differentiating factor between the youngest consumers and older car buyers, he said.
Cambridge Analytica found this and several other trends following its study which examined American car buying habits across key demographics.
About a third of millennials surveyed said fitting personal image was “extremely important,” while only a quarter of all respondents said the same, according to the study.
Last summer, Cambridge Analytica asked 3,018 respondents to consider the following set of factors: fits with personal image, affordability, high quality, driven by celebrities, brand reputation, made in the USA and environmentally friendly.
“When dealing with younger customers we might advise dealers to use a sales pitch based on matching an individual’s style and perhaps offer small personifications/bonus extras with the cars,” Richardson explained.
According to the study, Audi is the most desired brand amongst the millennials surveyed and Lexus and Honda ranked the lowest, which suggests the two brands don’t align with a millennial’s personal image.
Car owners vs. non-owners
The study also found that car ownership status rather than age is the best predictor when identifying shoppers who rate environment as important.
While environmental impact was found to be generally less important than both affordability and quality, 10 percent of respondents without a vehicle said they consider environmental factors extremely important.
Those without a car also consider affordability to be extremely important more often than quality. The group is 10 percent less likely to rate quality as extremely important and about 6.5 percent more likely to rate affordability as extremely important, according to the study.
Similarly, respondents who already own a car told Cambridge Analytica they are mostly interested in vehicles that offer higher quality than what they currently own.
Men vs. Women
High quality and affordability were the most important factors for both men and women.
But while a majority of both genders agree that the two factors are extremely important when choosing a new car, about 10 percent more women than men believe affordability, in particular, is extremely important.
Additionally, men are almost two times more likely than women to select BMW as their most desired brand, according to the study.
Other luxury brands such as Mercedes and Lexus were also found to be favorite brands for men.
Women were found to desire Japanese economy brands like Honda and Toyota most, while they significantly favor the Jeep brand more than men. Meanwhile, 7.6 percent of the women surveyed chose the American brand as their favorite compared to just 4.5 percent of men.
Interestingly, Audi was equally as popular with both genders: 7.8 percent of men chose the brand and so did 7.8 percent of women, according to the study.
Cambridge Analytica’s study was conducted online in June 2016, “when most people began talking about 2017 car models,” Richardson added.
Kia Motors America said that last month's certified pre-owned sales marked its best April ever and more than a 5-perecent increase. And this, right after Kia had its best first quarter ever for CPO.
Last month, Kia sold a 6,953 vehicles, which was up 5.6 percent year-over-year. CPO sales have risen 14 percent year-to-date, reaching 26,406 units, according to Autodata Corp.'s April CPO retail sales report.
"Kia's record CPO sales are not surprising when you consider Kia offers the longest powertrain coverage, excellent financing incentives and a strong inspection process," IntelliChoice director of data products Eric Anderson said in a news release. "This is why IntelliChoice awarded Kia the best popular brand CPO program."
Kia’s CPO program only accepts Kia vehicles that are five years old or newer with less than 60,000 miles, according to KMA. Each vehicle also undergoes a 150-point quality assurance inspection by certified technicians.
Additionally, KMA said all Kia CPO purchases come with a 10-year/100,000-mile powertrain limited warranty and 12-month/12,000 mile Platinum Coverage.
Maserati North America has launched a new Officine Maserati Certified Pre-Owned program that includes two years of unlimited-mile warranty coverage.
It also includes a free three-month trial of SiriusXM.
The company made the announcement about the new program, which began last month, on Tuesday.
As part of the certification process, each vehicle undergoes a 120-point inspection.
“Maserati pre-owned vehicles have their entire history thoroughly checked, with all services brought up to date, while being expertly certified to meet factory quality-assurance standards before qualifying for CPO status,” the company said in a news release.
“The Officine Maserati signifies the expertise and capabilities of Maserati Dealers to select, prepare and to exclusively add unlimited-mile coverage to a Certified Pre-Owned Maserati.”
Maserati said the CPO warranties are available at $2,095, and $2,445 for the GranTurismo.
There were 60 Maserati certified pre-owned sales in the U.S. during April, according to Autodata Corp. That beats year-ago figures, when it sold 48 CPO vehicles.
Through four months, Maserati has sold 270 certified vehicles this year, up from 202 in the same period last year.
In March, the company had its best-ever month for CPO sales, moving 79 units, Autodata said.
Maserati began reporting its certified sales to Autodata eight years ago this month. Autodata said that the automaker moved 205 certified vehicles the following year, which was Maserati’s first full year of sharing CPO results.
Autotrader’s list of the top certified pre-owned deals available this May recognizes BMW, Chevrolet, Volkswagen and Volvo for extending types of deals often reserved for buying new.
“Shopping CPO is ideal for price-conscious car shoppers that do not want to sacrifice quality over a good deal,” Autotrader executive editor Brian Moody said in a news release. “With CPO inspection and warranty coverage, you're likely to get a vehicle that is among the better choices out there.”
BMW's CPO program offers models that are available with a warranty that offers coverage for up to six years or 100,000 miles from the original sale date this month. Shoppers particularly interested in the brand’s 3 Series or 4 Series can get 0.9 percent interest for up to 36 months. Autotrader calls this offer “a new-car deal on a used model.”
Chevrolet is offering qualified shoppers interested in a CPO Chevrolet Cruze, Equinox, Malibu, Silverado or Traverse 1.9-percent interest for up to 36 months through the end of May. This is an exceptional rate for a used vehicle, Autotrader said.
This month Ford's CPO program boasts up to seven years or 100,000 miles of powertrain protection from the original sale date, as well as an additional year or 12,000 miles of bumper-to-bumper coverage. Qualified buyers will also be offered 2.9-percent interest for up to 66 months on all of its CPO models, according to Autotrader.
Nissan's program is extending “impressive” incentives to qualified shoppers that are available on any model among its CPO fleet through the end of the month. May’s offerings include 1.95-percent interest for up to 36 months or 3.95-percent interest for up to 72 months. Additionally, Nissan is offering up to $500 cash back on its Altima, Maxima, Rogue and Sentra models.
Throughout the month, Land Rover's program will extend bumper-to-bumper coverage for up to seven years or 100,000 miles. Autotrader said the best deal Land Rover has this month is on 2013-2015 Evoque models. The automaker is offering qualified shoppers interested in an Evoque CPO 0.9-percent interest for up to 60 months.
Toyota's CPO program is among Autotrader’s highlights this month. The automaker is offering seven years or 100,000 miles of powertrain protection, along with an extra year of bumper-to-bumper coverage. Additionally, through the end of the month, the Prius is available at 1.9-percent interest for up to 60 months. The deal also extends to the smaller Prius c and larger Prius v.
This month Volkswagen has a special offer aimed at qualified shoppers interested in financing. Throughout May, shoppers can purchase any CPO model with 1.99-percent interest for up to 60 months. Autotrader said this is “a great rate and a long term that you'll typically only find in the world of new vehicles.”
Volvo’s CPO program is offering shoppers bumper-to-bumper warranty coverage for seven years or 100,000 miles from the original sale date, through the end of the month. Autotrader said this is among the longest warranties in the industry. Qualified buyers interested in financing their CPO purchase can also get 0.9 percent interest for up to 24 months. This is a rate rarely offered on used models, according to Autotrader.
For additional details on the CPO programs Autotrader named this month, click here.
