Certified pre-owned sales are growing, and they give F&I managers a fresh opportunity.
CPO customers get a shiny, like-new car at a lower price than they'd pay for a new vehicle, and F&I managers get a chance to offer them the warranty wraparound products, service contracts and appearance packages that keep vehicles in like-new condition.
U.S. sales of CPO vehicles were 1.6 million this year through July, up 4.1 percent compared with the 2015 period, according to the Automotive News Data Center.
For the F&I department, CPO sales are the "midpoint between a brand-new vehicle and a used vehicle," says Rick Kurtz, senior vice president for distribution at F&I product provider Protective Asset Protection. "It's like a new vehicle, but the coverage tends to be shorter term and sometimes less comprehensive," he said.
George Angus, president of F&I consultant Team One Group, believes used vehicles gained a new image with certified sales. "The used-car department has become in some ways like the new-car department with the sale of CPO vehicles," he told Automotive News. "CPO vehicles come with a warranty from the factory, so the service contracts are sold much the same way as [they are with] new cars."