Why so many non-CPO M3 / M4?

[m_michael]

I'm seeing dealers with multiple used non-CPO M3 / M4 in their inventory, while having many non-M cars with CPO. Any thoughts on why this is happening? Was this the case with previous generation M cars too?

[Thescout13]

Do some searching. Most are former M Performance school cars which CANNOT be CPO'd. They come in waves.

Other reason can be if there were no 1200 mile service done.

[m_michael]

Originally Posted by Thescout13

Do some searching. Most are former M Performance school cars which CANNOT be CPO'd. They come in waves.

Other reason can be if there were no 1200 mile service done.

I did. Some of the cars even have normal looking Carfax reports. Standard lease with proper service intervals.

[Thescout13]

Originally Posted by m_michael

I did. Some of the cars even have normal looking Carfax reports. Standard lease with proper service intervals.

Where were they registered?

Reasons why a car is not CPOd:

1. Was an M performance school car (registered in NJ)
2. Did not have the 1200 mile service in time (less than 2000 miles)
3. Car was in an accident
4. Not being sold by a BMW dealer
5. Car was turned in after warranty voided - can be due to mods or mileage
6. The car is in such bad shape even BMW wouldn't certify it

Besides those reasons above, BMW really has no reason to not certify it. Which means you should avoid non-CPO cars like the plague.

We have been through this a few times with other posters. Just post links to these cars you are talking about and someone on here will tell you really quick why it's not CPOd

[m_michael]

Here's one:
http://cpo.bmwusa.com/used/2015-BMW-...5484?zip=91007

I literally did a search from a CA zip code with a 500 mile radius. These are all BMW dealerships.

The results are interesting:
M3
All Pre-Owned (51)
Certified Pre-Owned (17) <-- this seems unusually low

M4
All Pre-Owned (57)
Certified Pre-Owned (29)

[Hachima]

Another thing to consider is that it can cost a dealership 4k+ to get a car CPOd. If they think they can move the car without that expense they won't CPO it. If there is a car you are interested in it wouldn't hurt to ask what it would take to CPO it and why not if they can't.

Think of the houses in the bay area that are completely trashed but still sell for millions. Why remodel/fix it up when it still will sell in hours once listed

[m_michael]

Originally Posted by Hachima

Another thing to consider is that it can cost a dealership 4k+ to get a car CPOd. If they think they can move the car without that expense they won't CPO it. If there is a car you are interested in it wouldn't hurt to ask what it would take to CPO it and why not if they can't.

Think of the houses in the bay area that are completely trashed but still sell for millions. Why remodel/fix it up when it still will sell in hours once listed

Yeah perhaps they think the M3s will move without CPO. I have a PASSED CPO report for a car I recently looked at and it's just a VERY thorough checklist. No way it cost $4k to do. I could see some additional costs with replacing tires and/or fixing the various items that didn't pass.

I suppose it better to play it safe and get an independent inspection.

[doug_999]

To CPO a car, you do the work to bring to spec (tires, windshield, brakes, etc) then pay BMW a hefty sum for the warranty. I believe that second number is rather large (will check, but $4k doesn't sound wrong).

And it is a one way street. So no undoing it. Now the car is on your lot for $4k more than the dealer next door.

And people are cheapasses

[SMGCFP]

The dealership will CPO a car if you ask them to (and pay more money) , if the car qualifies. The don't do if off the bat for the reasons everyone else has already stated.

[LVI]

There is rarely a significant price difference between cpo and non cpo cars and most of the work is done anyway prior to selling the car whether cpo or not. I believe the fee is $2K or less.

My guess is most cars are not eligible (you'd be surprised how many of these cars missed or had their 1200 mile service late), have collision history reported on the Carfax (emphasis on reported as I've seen plenty of cars with major body repairs get certified if it wasn't reported). More importantly, they like to sell an extended warranty instead, which adds to their gross profit alot more than the rather insignificant cpo price premium.

Obviously non BMW dealers don't cpo for obvious reasons.

[RickFLM4]

Contrary to popular expectations, accidents do not automatically disqualify a car from being CPO’d. An individual dealer can choose not to CPO any car, including for an accident or bad repair job, but don’t assume there is no chance that a CPO car was in an accident. It is more about whether the pricing will make sense.

I suspect the primary reasons are cost to CPO / high sales price needed and, to a lesser degree, skipped / late 1,200 mile maintenance.

[Fuller]

Originally Posted by doug_999

To CPO a car, you do the work to bring to spec (tires, windshield, brakes, etc) then pay BMW a hefty sum for the warranty. I believe that second number is rather large (will check, but $4k doesn't sound wrong).

And it is a one way street. So no undoing it. Now the car is on your lot for $4k more than the dealer next door.

And people are cheapasses

They only change what meets the cpo criteria for needing to be changed. In other words, tires worn below a certain limit, brakes below 50% etc, otherwise they don't change it for cpo.

[Thescout13]

Another thing to consider is that the CPO.bmw.com website is rarely accurate.

For example, my 17 DCT CPO was listed as a manual non-CPO. Went to the dealer website and it was a CPO and the pictures clearly showed a DCT. Point being, call and ask. Most times they will tell you why it wasn't CPOd too.

I bet the fixes some cars need cost more than the profit for selling a CPOd car so why waste their time?

[doug_999]

Originally Posted by Fuller

They only change what meets the cpo criteria for needing to be changed. In other words, tires worn below a certain limit, brakes below 50% etc, otherwise they don't change it for cpo.

Let's take two cars
Car#1 M3 in perfect condition, tires great, windshield not cracked, all good. Cost to dealer is $2,800 to CPO the car and get an extra year of warranty.

Car#2 M3 in crappy condition, needs tires, an alignment, etc. Cost to dealer is cost to put car back to CPO minimums, PLUS $2,800 to CPO the car and get the extra year of warranty.

So the minimum cost is $2,800.

AND to be clear, BMW does NOT approve of dealers adding CPO to a car because you ask for it - while lots of dealers will do it, officially it is not condoned.

PS - $2,800 is the correct amount

[Audio Fan]

When I turned in my first M4, the dealer said that they were going to certify the car, but that was the exception. He said that they generally don't certify the M cars because they are likely to be driven much harder than the non-M cars. I was surprised, but it makes sense. The numbers on this thread seem to back it up.

Personally, I'm a bit hesitant to by a used M car, especially the turbo versions. I just don't want a car that has been tracked or tuned. You never know if these cars have been tracked, ragged out, or tuned in many instances.

[LVI]

Originally Posted by doug_999

Let's take two cars
Car#1 M3 in perfect condition, tires great, windshield not cracked, all good. Cost to dealer is $2,800 to CPO the car and get an extra year of warranty.

Car#2 M3 in crappy condition, needs tires, an alignment, etc. Cost to dealer is cost to put car back to CPO minimums, PLUS $2,800 to CPO the car and get the extra year of warranty.

So the minimum cost is $2,800.

AND to be clear, BMW does NOT approve of dealers adding CPO to a car because you ask for it - while lots of dealers will do it, officially it is not condoned.

PS - $2,800 is the correct amount

except for #2, the dealer would've replaced the tires, done the alignment, serviced (whatever is required based on mileage, but oil change at a minimum) and reconditioned the car regardless if it were to be CPO'd, IF they were going to retail it. To add to this, the dealer will have generally paid less for this specimen, than for car #1.

Cars that come in in poor shape and are beyond the typical used car reconditioning, end up getting wholesaled anyway, so this is a moot point.

The standards are a bit higher for franchise dealership (i.e. BMW dealers) than for Abdul's Used Car lot so they will not try to sell a $45-$50K car with bald tires and at least the minimum servicing required for the mileage.

This CPO thing mainly comes down to each individual car, with maximizing gross profit as the overarching strategy. From a dealer's perspective, the customer who really wants to add the CPO, can request it (if the car is even eligible) and pay for it, or buy an extended warranty (OEM or otherwise) which can boost the dealership's bottom line. No reason to rack up the cost, and hope someone actually sees value in the additional warranty coverage. If you observe the prices, the CPO premium is minimal, and from my observations, in many cases less than $3K per car.

[doug_999]

Originally Posted by lawrence1

except for #2, the dealer would've replaced the tires, done the alignment, serviced (whatever is required based on mileage, but oil change at a minimum) and reconditioned the car regardless if it were to be CPO'd, IF they were going to retail it. To add to this, the dealer will have generally paid less for this specimen, than for car #1.

Cars that come in in poor shape and are beyond the typical used car reconditioning, end up getting wholesaled anyway, so this is a moot point.

The standards are a bit higher for franchise dealership (i.e. BMW dealers) than for Abdul's Used Car lot so they will not try to sell a $45-$50K car with bald tires and at least the minimum servicing required for the mileage.

This CPO thing mainly comes down to each individual car, with maximizing gross profit as the overarching strategy. From a dealer's perspective, the customer who really wants to add the CPO, can request it (if the car is even eligible) and pay for it, or buy an extended warranty (OEM or otherwise) which can boost the dealership's bottom line. No reason to rack up the cost, and hope someone actually sees value in the additional warranty coverage. If you observe the prices, the CPO premium is minimal, and from my observations, in many cases less than $3K per car.

Yea, the dealer is going to make a decision "Is it worth it to CPO this car?" and that decision is based on the condition of the car AND if CPO is going to help sell it.

I believe M cars cost more to CPO (and to clarify, that means the dealer pays BMW more for the CPO designation on a M car) - so they do it less. And it is a one way street - you can't CPO a car and then undo it - so the money is sunk.

And once again, WHILE you can ask a dealer to certify a car, if they do that and are caught by BMW, it is a bad thing.

[jailonacs99]

Cost was why the dealer I purchased my M4 from took off the CPO. It was originally listed as CPO for about $4K more but it wasn't moving off their lot for over a year (they weren't in a big M car market either). They dropped the CPO to drop the price, and that's when I called them right up.

I got a price alert when it popped up on a 3rd party site so fast they still had the CPO listing up on the BMW NA website. I could literally compare the ads side by side. He asked where I saw it, maybe he was hoping I was calling about the CPO price listing. :

Spent the difference on a 5 year extended warranty instead of the extra year or two I would've gotten via CPO.

[RickFLM4]

Originally Posted by jailonacs99

Cost was why the dealer I purchased my M4 from took off the CPO. It was originally listed as CPO for about $4K more but it wasn't moving off their lot for over a year (they weren't in a big M car market either). They dropped the CPO to drop the price, and that's when I called them right up.

I got a price alert when it popped up on a 3rd party site so fast they still had the CPO listing up on the BMW NA website. I could literally compare the ads side by side. He asked where I saw it, maybe he was hoping I was calling about the CPO price listing. :

Spent the difference on a 5 year extended warranty instead of the extra year or two I would've gotten via CPO.

If the CPO is a sunk cost to the dealer once they incur it (per other posts in this thread), why would they drop the CPO? Wouldn’t keeping the CPO and dropping the price move it even faster?

[doug_999]

Originally Posted by RickFLM4

If the CPO is a sunk cost to the dealer once they incur it (per other posts in this thread), why would they drop the CPO? Wouldn’t keeping the CPO and dropping the price move it even faster?

I stand corrected. Apparently a car is never really enrolled until the car is reported sold into a customers name.

[m_michael]

Originally Posted by jailonacs99

Cost was why the dealer I purchased my M4 from took off the CPO. It was originally listed as CPO for about $4K more but it wasn't moving off their lot for over a year (they weren't in a big M car market either). They dropped the CPO to drop the price, and that's when I called them right up.

I got a price alert when it popped up on a 3rd party site so fast they still had the CPO listing up on the BMW NA website. I could literally compare the ads side by side. He asked where I saw it, maybe he was hoping I was calling about the CPO price listing. :

Spent the difference on a 5 year extended warranty instead of the extra year or two I would've gotten via CPO.

That's really interesting. The vehicle apparently passed the CPO checks, but was sold without it. Something to consider when shopping / negotiating.

[Robotechnology]

#1 reason why M's are sold without CPO is cost not because something is wrong. There are less "story" car reasons than financial considerations. $3K difference in listing price is huge for internet shopping everything else being equal. You can also purchase 3 years of BMW coverage if you're keeping it a while vs the 1 year of CPO. Obviously your total cost may be more but, you may be better off. 3rd party options are also available for even longer with some companies.