Certification Eases Used Car Buying

The number of certified "pre-owned" vehicles continues to grow as a market force, tempting shoppers who worry about potential problems with their used-car purchase. Used cars are a gamble. Certification programs, operated by automakers and their dealers, can provide a welcome—if somewhat costly—"safety net" to reduce that risk.

Viability
Certification programs have been around for years, led by premium brands. Mercedes-Benz began in 1989, followed by Porsche and Lexus. In 2003, 38 percent of late-model used cars were certified, according to J.D. Power, up from 28 percent in 2000. "The good news is, the volume is growing," said Tom Kontos, vice-president of industry relations and analytical services at ADESA, an auction chain. Total volume could even approach two million in 2004, versus last year's 1.3 million.


The industry "has been in and out" of certification, said Marv Ingram, national certified pre-owned/fleet manager for Lexus. "Consumers were very confused about certification." Now, "everybody's in it to stay."


Certified "sales are up across the board this year," said Jeffrey Heichel, GM's director of used vehicle activities, prompted by "our customers' desire for a worry-free used-vehicle purchase." At DaimlerChrysler, sales are "chasing" 100,000 for the year, said Ray Fisher, vice-president for fleet and remarketing. "The certified industry is pretty strong." Ups and downs are "based on the aggressiveness of the new-car deals."


"Awareness of it continues to increase," said Art Spinella, president of CNW Marketing. Of those who know about certified, half will look at a certified vehicle when it's time to shop. Only 20 percent know they can get one. Three years ago, the figure was 11 percent. J.D. Power surveys suggest that about half of used-car shoppers were aware of certification, according to senior director Scott Weitzman. But "there's still a lot of confusion from the consumer about who is doing the certifying," Weitzman said at the National Remarketing Conference held by "Auto Remarketing" magazine.