Table of Contents
Executive Summary
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- The issues
- Overall purchase intent trending downward
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- Figure 1: Purchase intent, July 2016-April 2017
- Less than two in 10 car shoppers considering a CPO vehicle for their next purchase
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- Figure 2: Purchase type, April 2017
- Awareness of certified pre-owned programs limit interest
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- Figure 3: CPO awareness, by car shoppers, April 2017
- The opportunities
- CPO shoppers expect to pay $8,000 more than used car shoppers
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- Figure 4: Purchase type, by purchase price, April 2017
- Pricing and low mileage can attract non-CPO shoppers
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- Figure 5: CPO influencers – Not considering CPO, April 2017
- Younger women can be converted to CPO inventory
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- Figure 6: CPO awareness and consideration, by gender and age, April 2017
- What it means
The Market – What You Need to Know
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- Certified pre-owned expected to grow
- Off-lease vehicles provide prime CPO inventory
- New vehicle incentives erode CPO demand
Market Size and Forecast
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- CPO sales growth expected to continue
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- Figure 7: Total US unit sales and fan chart forecast of certified pre-owned vehicles, forecast, 2012-22
- Figure 8: Total US unit sales and forecast of certified pre-owned vehicles, 2012-22
Market Breakdown
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- Leasing grows as percentage of market share
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- Figure 9: Method of acquisition, by most recently acquired vehicle, 2013-17
- Foreign brands grow share in CPO sales
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- Figure 10: Most recently acquired CPO vehicle, by domestic and foreign, 2013-17
Market Perspective
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- New vehicle incentives reduce appetite for CPO
Market Factors
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- Off-lease vehicles increase supply of prime CPO-qualified inventory
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- Figure 11: Method of acquisition, by most recently acquired vehicle, 2013-17
- High consumer confidence should boost sales
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- Figure 12: Consumer Sentiment Index, January 2007-April 2017
Key Players – What You Need to Know
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- Top four brands top CPO sales as well
- Growth for Nissan will spur CPO sales
- Dealerships leasing CPO inventory
- Certified pre-owned programs lack exposure to overall market
Brand Sales of CPO Vehicles
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- Ford, Chevrolet, Toyota, and Honda make up nearly half of all CPO sales
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- Figure 13: Brand of most recent vehicle purchase, by CPO buyers, 2017
What’s Working?
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- Certified pre-owned market on cruise control
- CPO sales similar to new vehicle sales
What’s Struggling?
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- Overall awareness of CPO programs is lacking
What’s Next?
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- Leasing CPO vehicles
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- Figure 14: Infiniti CPO leasing acquisition email, email, August 2016
- Figure 15: Certified Pre-Owned by Mercedes-Benz Sales Event, direct mail, February 2015
The Consumer – What You Need to Know
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- Shoppers considering CPO expect to spend $8,000 more than used shoppers
- Awareness of CPO programs an issue
- Price and low mileage top enticements for non-CPO shoppers
Purchase Intent
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- Nearly six in 10 consumers plan to buy a vehicle within the next three years
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- Figure 16: Purchase intent, April 2017
- Purchase intent trending downward
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- Figure 17: Purchase intent, July 2016-April 2017
Purchase Type
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- CPO consideration low
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- Figure 18: Purchase type, April 2017
- Younger women likely to consider CPO despite lower awareness
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- Figure 19: Purchase type, by gender and age, April 2017
Expected Price
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- Nearly six in 10 car shoppers plan to pay more than $25,000 on next vehicle
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- Figure 20: Expected price, April 2017
- Figure 21: Expected price – Mean and median, April 2017
- CPO shoppers expect to pay $8,000 more than used car shoppers
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- Figure 22: Purchase type, by purchase price – Mean and median, April 2017
CPO Awareness
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- Awareness and education an issue for CPO programs
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- Figure 23: CPO awareness, April 2017
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- Figure 24: BMW Certified Pre-Owned “Wash,” January 2017
- Figure 25: BMW Certified Pre-Owned “Shopping Cart,” January 2017
- Younger women least likely to know much about CPO programs
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- Figure 26: CPO awareness, by gender and age, April 2017
CPO Influencers
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- Price and low mileage attractive for nonshoppers
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- Figure 27: CPO influencers – Not considering CPO, April 2017
- TURF analysis for shoppers not considering CPO
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- Figure 28: TURF analysis – CPO influencers, April 2017
- Blacks receptive to dealership perks
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- Figure 29: CPO influencers – Not considering CPO, by ethnicity and Hispanic origin, April 2017
- Price and clean history report are top reasons for CPO shoppers
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- Figure 30: Mercedes-Benz Certified Pre-Owned Sales Event, direct mail, May 2017
- Figure 31: CPO influencers – Reasons for choosing CPO, April 2017
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- Figure 32: TURF analysis – Reasons for choosing CPO, April 2017
Brands Considered for CPO
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- Top-selling brands get top responses for consideration
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- Figure 33: Brands considered for CPO, April 2017
- Toyota and Honda outperform among CPO shoppers
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- Figure 34: Brands considered for CPO, by purchase type, April 2017
Attitudes toward Certified Pre-Owned
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- Majority of shoppers associate used purchases with risk
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- Figure 35: Attitudes toward CPO, April 2017
- CPO inventory can expand luxury brand reach
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- Figure 36: Attitudes toward certified pre-owned, by purchase type, April 2017
- Younger shoppers receptive to extended warranties
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- Figure 37: Attitudes toward CPO, by gender and age, April 2017
Cluster Analysis
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- Figure 38: Certified pre-owned segments, April 2017
- New Car Buyers
- Characteristics
- Opportunities
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- Figure 39: Profile of New Car Buyers, April 2017
- CPO Skeptics
- Characteristics
- Opportunities
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- Figure 40: Profile of CPO Skeptics, April 2017
- Bargain Seekers
- Characteristics
- Opportunities
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- Figure 41: Profile of Bargain Seekers, April 2017
- Ideal CPO Shoppers
- Characteristics
- Opportunities
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- Figure 42: Profile of Ideal CPO Shoppers, April 2017
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Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Fan chart forecast
- Consumer survey data
- Direct marketing creative
- Abbreviations and terms
- Abbreviations
- Terms
- Methodology – TURF analysis
Appendix – The Market
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- Figure 43: Market share of certified pre-owned vehicles purchased, by most recently acquired vehicle, 2015-17
- Figure 44: Market share of certified pre-owned vehicles, by most recently acquired vehicle, 2013-14
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