# Is CPO worth it?



## Scott2.0 (Jul 3, 2017)

I posted this over in the 6-Series forum, but thought this applies to all anyway. I apologize for the repetitive post.

Anyway, I'm looking at nearly a $7k spread between CPO and non. I almost had myself sold on going CPO for the peace of mind, but then I came across this http://cpo.bmwusa.com/Content/docs/B...NotCovered.pdf It seems like much of what can go wrong with a 50k+ mile car is excluded. Are those of you with CPOs getting value out of it? A $7k insurance policy seems awfully steep. Do I try to close that gap or do I roll the dice on a non-CPO and use the savings in the event of a repair?


----------



## Kamdog (Apr 15, 2007)

Can you buy a better warranty for less than 7K?

In this case, that is the answer.


----------



## Scott2.0 (Jul 3, 2017)

Kamdog said:


> Can you buy a better warranty for less than 7K?
> 
> In this case, that is the answer.


That's a great question and one that I don't know the answer to. I started looking into it and every third party warranty company out there has tons of complaints, so it's tough to determine their value.

Assuming that I can close that $7k gap, I'm interested in hearing what people have used their CPO warranty for, given the extensive list of exclusions.


----------



## Rusty34 (Feb 3, 2017)

In 2008 we purchased a 2007 550i CPO with 12k miles and we renewed the warranty each time it came up until it finally expired at 152k miles. That warranty covered all the expensive issues the E60/ N62 is now well known for which we experienced over the course of our long term ownership. There was still a couple of known big ones we had not encountered yet such as the coolant transfer tube in the block and the transmission mechatronics sleeve so we decided it was time to trade. Our experience with long term ownership suggests it may not be wise to own a BMW without a warranty, particularly one with a V8.

Just recently another member posted that his 750i began smoking and using oil excessively. The dealership service advisor told him the valve seals needed to be replaced at a cost of several thousand dollars. He has a 3rd party warranty so the claims rep was called out to review it and was promptly denied because nothing was found broken, the issue was the result of normal wear according to the rep.

In this case he paid for an expensive aftermarket warranty which excluded coverage that the BMW extended warranty would have included. This same issue came up for us also on our 2007 but our BMW warranty or extended service plan covered it for us.


----------



## Scott2.0 (Jul 3, 2017)

Rusty34 said:


> In 2008 we purchased a 2007 550i CPO with 12k miles and we renewed the warranty each time it came up until it finally expired at 152k miles. That warranty covered all the expensive issues the E60/ N62 is now well known for which we experienced over the course of our long term ownership. There was still a couple of known big ones we had not encountered yet such as the coolant transfer tube in the block and the transmission mechatronics sleeve so we decided it was time to trade. Our experience with long term ownership suggests it may not be wise to own a BMW without a warranty, particularly one with a V8.
> 
> Just recently another member posted that his 750i began smoking and using oil excessively. The dealership service advisor told him the valve seals needed to be replaced at a cost of several thousand dollars. He has a 3rd party warranty so the claims rep was called out to review it and was promptly denied because nothing was found broken, the issue was the result of normal wear according to the rep.
> 
> In this case he paid for an expensive aftermarket warranty which excluded coverage that the BMW extended warranty would have included. This same issue came up for us also on our 2007 but our BMW warranty or extended service plan covered it for us.


Thanks, Rusty, just the insight I was looking for. Would you say that you came out ahead when factoring in the initial premium of the CPO and then the total cost of the subsequent extensions?

The car I'm interested in is a 650i GC, so it seems a warranty may be even more important given its engine.


----------



## 1968BMW2800 (Aug 13, 2016)

We have come to understand, thanks to comments from CA's posted on various threads, that the suggested pricing on BMWNA protection products does not have as high a dealer mark up as many 3rd party products. And, at least there is the hope that BMW will work with you if you have a claim on a BMW supported insurance plan. And, remember, that's what these babies are, not warranties, but insurance plans. And insurance is purchased to mitigate risk -- the cost of the insurance must be weighed against the potential risk. Different circumstances lead to differing conclusions. Most who do the math realize that self-insuring is often more cost effective, yet we have all heard stories of people facing big repair bills but, because they had the insurance, they came out ahead. But those cases are, statistically, rare, since the only way insurance works is that the loss rates favor the house.

The CPO is a way for a customer to have some _small amount_ of assurance, not insurance, but _assurance_, that the dealer has taken a close look at the car and has corrected anything they found. A lot of trust is involved unless the customer is allowed to witness the inspection and knows enough about what is being witnessed.

So CPO has some value. $7,000 of value? If I felt I needed to spend an extra 7 grand for a CPO with a very long list of NOT COVERED items -- items that cost a lot to fix, I'd think long and hard about the value proposition on that deal...

Which brings up the main point. A used car, CPO or not, is a used car and the buyer is assuming greater risk than if acquiring a fully factory warrantied new car. Therefore, _the price paid for a used car should reflect the risk the buyer is assuming._

Dealers can ask whatever they want. Prospective buyers can offer as low as they feel is necessary to mitigate potential downstream repair costs. And, for peace of mind, they can purchase additional insurance, hopefully at a discounted price as well.


----------



## 1968BMW2800 (Aug 13, 2016)

One more comment, if I may. I have purchased a very, very clean low mileage CPO and had a great experience with zero warranty issues or CPO claims. I ground hard on the deal and argued that the _market value_ of the car, CPO or no CPO, was the correct price point. the dealer argued that CPO increased the market value. In the end, I paid the low end of current market value for the model, the year, the mileage, and the condition -- the final selling price was well below the "CPO Premium" the dealer initially asked. A used car deal is a used car deal. And used cars are sold based on what a willing buyer will pay and a seller will take. No shame in testing the bottom, on cars or add-on 'warranty' products.

Hope this helps.


----------



## spokelizard (Jun 10, 2009)

I bought my X3 CPO in 2009 with 25K miles. Between the remainder of the original warranty and the CPO I estimate I had $7K of repairs done. The biggest one was to take care of "ticking sound" in the N52 engine. Per BMW protocols first they changed the valve lifters, a year later when that hadn't worked they replaced the cylinder head. Other things replaced were oil level sensor (twice), and power seat mechanism, and a noisy heater/ac fan. All of this done at no charge at BMW dealer. I can't imagine a third party warranty would have covered all that.

But most of this was actually covered under the remaining two years of the factory warranty. Maybe $1,000 was under the CPO which extended the factory warranty for another two years.

So in evaluating whether to get CPO, realize you may really be paying for only two years coverage. That $7K sounds like an outrageous price spread, and if it's part of the asking price for a used car it's of course subject to negotiation. But if you've found the car you want, negotiate your best deal and buy it, knowing you're paying for something you may or not ever use. Three or four years from now you won't remember it.

You should also check on the cost of BMW extended warranty coverage. I think that's available as long as you're still under the original factory warranty, and in this case may be cheaper than the CPO spread. But that means finding a different car than the one you've found.


----------



## MJBrown62 (Jun 15, 2016)

Bear in mind that nearly all 3rd party extended service contracts have the same types of "wear and tear" exclusions that you see in both the CPO Warranty and the BMW ESC's. 

Think about it: you have a 5½ year old car with 90k miles on it and driven it on our poor infrastructure roads. It is not unreasonable to think that struts or springs might get shot. 

You get a CPO BMW or an extended service contract as insurance against the big stuff: engine, transmission, powertrain, AWD systems, etc.

mjb


----------



## 1968BMW2800 (Aug 13, 2016)

MJBrown62 said:


> Bear in mind that nearly all 3rd party extended service contracts have the same types of "wear and tear" exclusions that you see in both the CPO Warranty and the BMW ESC's.
> 
> Think about it: you have a 5½ year old car with 90k miles on it and driven it on our poor infrastructure roads. It is not unreasonable to think that struts or springs might get shot.
> 
> ...


Once again, we have a seasoned CA's voice of experience and calm reason.

The Zen of life involves managing risk -- one of the best ways to manage risk is to not bring too much obvious risk into one's life, unless the thrill of living with that risk is what one seeks. And, insurance helps mitigate risk, if the price is right and the risk makes it all worth it.

I am amazed when I hear about people buying out-of-warranty, high mileage cars with the expectation that, because they are high line vehicles, they are not subject to the realities of miles, time, physics, and crappy roads. Or people buy clean, low mileage used cars, still in warranty, but expect that the newness now will somehow protect them against what often happens a few years, and tens of thousands of miles, down the road. Pay now, pay later, but no free lunches from the BMW Center.


----------



## Goffinlover (Jun 18, 2017)

I've purchased 3 BMW CPOs over the years and have not extracted the value spread in repair costs with one possible exception. An '03 325i had a failed central locking system and one or two window lifts replaced via CPO. The 3-series is a high volume vehicle in SoCal, thus the sales price differential was minimal.

Aftermarket warranties are IMO a leap of faith and I'd rather partner with a manufacturer of reasonable stature. As others have posted, with a CPO premium the intent is purchasing indemnification and peace of mind. I will remain favorably predisposed in the future.


----------



## king0fspades (Aug 22, 2009)

Scott2.0 said:


> I posted this over in the 6-Series forum, but thought this applies to all anyway. I apologize for the repetitive post.
> 
> Anyway, I'm looking at nearly a $7k spread between CPO and non. I almost had myself sold on going CPO for the peace of mind, but then I came across this http://cpo.bmwusa.com/Content/docs/B...NotCovered.pdf It seems like much of what can go wrong with a 50k+ mile car is excluded. Are those of you with CPOs getting value out of it? A $7k insurance policy seems awfully steep. Do I try to close that gap or do I roll the dice on a non-CPO and use the savings in the event the of a repair?


I just bought a CPO for my son. Buy it from CA. Don't go to Chapman. They will rob you. You will save at least 3k compared to Chapman. I also got a new 740i for myself as well. See my pic below. I took on I10 while bring the car from CA.


----------



## 1bad540 (Jan 21, 2006)

cpo is always worth more, its a bmw warty at the end that covers plenty of things that will break. That said.. can u extend the warty on the non cpo car? most of the cpo cars i have bought have been exceptionally clean cars w new tires,brakes, bumpers touched up and detailed. The warty is icing. Id say any decent warty is going to cost u around 3k add that to the cost of an up to date service with items replaced and see where u stand.


----------



## carsheadline (Jun 29, 2017)

Wow, that 7k price difference would have me thinking too...

I guess it would depend upon how long you want to keep the car and how worried you are about repairs.

The CPO is great for peace of mind, but still. That's a big price difference.


----------



## Goffinlover (Jun 18, 2017)

Been a while, but IIRC the spread between my CPO purchase of an '03 325i and comparable private party sale was roughly $1K. Negotiated cost was significantly below sticker price, and SoCal is a hypercompetitive market with a huge selection of 3-series.

OTOH, the spread for my '02 Z3 Coupe is more difficult to ascertain as so few were produced. Dealer had the vehicle 90% to my desire, so it was a satisfying deal.


----------



## Eedy (Jul 24, 2017)

IMO its worth it to get CPO, but one alternative is to purchase private party with very low miles (get a pre-purchase inspection). Private party can save a nice chunk of money for a very lightly used car.


----------



## 559056 (Oct 8, 2016)

I'm developing a sense of this whole CPO marketing thing, regardless of makes, over the last few years. Caveat, I have little faith in companies, commission based employees of said companies, and now previous owners of cars.
We are now the owner of 2 brand new BMWs, that took us years to get to the point of purchase. We started looking at reasonably depreciated used cars, mostly off of lease, that appeared to be low mileage bargains. As time wore on, each potential purchase reveal extra ordinary faults, I began to suspect the process was flawed. Then I joined this forum and gathered a sense of collective experiences from CPO purchases. My summation of suspicions below:

1) Most people, even well intentioned car owners, treat their cars like disposable trash. They neglect basic inspection/maintenance. They used them for destruction derbies.
2) Lease owners, probably the majority, are worse. They view their cars as extended rentals. They know that the car will likely hold together, as long as they don't get too outrageous in their abuse. They want to scrimp on every possible cost. People who rent cars, have no interest at all in respecting the rental company's property.
3) Dealers suspect this or know this. But, on low mileage low age vehicles that have been detailed, those signs of abuse don't show on the lot, to the average used car buyer. As long as the CarFax is clean, that is even a plus for the sale. Then to top it off, they throw in a CPO designation, to lure the unsuspecting buyer.
4) Most cars on used cars are bought at auction, w/o any inspection. Buyers naturally assume they are taken in trade. 

The most outrageous example that we almost fell for:
We watched a 15 550i M-sport sit on a Jaguar lot for months. The price dropped below KBB, probably because of a ding visible on the front facia and the chocolate brown interior w/Alpine white exterior. As soon as I visited the lot, I ran my fingers around (What I honestly thought was the lip of the M-sport front facia.), to see how many curbs the owner had misjudged, and to see how much the front facia would cost to repair. It was pretty rough, and the ragged lip extended all the way around the bottom curve of that bulky facade (that is the clue to knowledgeable owners). The salesman and I agreed that the dealership would be better off painting the front facia, and getting a decent offer to cover the cost. We almost went for the deal. Timing/life got in the way. Even though the price continued to plummet, we never bought it. 
Now I have a brand new 550 M-sport. ! There is no lip on the front facia. It is a solid piece that extends all the way back to the front suspension sub frame, where it is fastened! The lessor, had so trashed the car, by repeatedly clobbering curbs, he just used a box cutter, and cut away all the underside of the piece, to even it all out.


----------



## MJBrown62 (Jun 15, 2016)

One-off examples like these are not the norm. I don't consider a curbing the front fascia as "abuse." Just bad driving.

In my time with the brand, I rarely find a lessor that has abused their vehicles or treated it like a rental. The vast majority are more worried that they are going to get hammered at lease end for the excessive wear and tear. Some want to keep their lease vehicle. And for BMWs, they are maintained, as it's paid for!

With the level of auditing that BMWNA does of CPO BMW dealers, the suggestion that we just "throw in a CPO designation" on it is grossly inaccurate. No BMW dealer will risk a penalty, or holdback on new cars, or the CPO franchise license, by cheating the system.

I'm not saying that we are all perfect. And we're guilty of not making every inch perfect. That's not BMW's requirement. So some surface wear and tear doesn't get done. But BMW has requirements and if there is reason to believe that we skip or short the car of that process, things don't go well.

At "Full-Circle" BMW Franchise Centers, most CPO vehicles are lease turn-ins, not auction cars. And most bought at auction are done so at a BMW closed auction.

Customers shouldn't fear an auction car. It doesn't expressly imply it's damaged goods. It could be a lease turn in that a dealer doesn't need. It could be a trade in at a non-BMW dealer.

MJB



Glaird said:


> 1) Most people, even well intentioned car owners, treat their cars like disposable trash. They neglect basic inspection/maintenance. They used them for destruction derbies.
> 2) Lease owners, probably the majority, are worse. They view their cars as extended rentals. They know that the car will likely hold together, as long as they don't get too outrageous in their abuse. They want to scrimp on every possible cost. People who rent cars, have no interest at all in respecting the rental company's property.
> 3) Dealers suspect this or know this. But, on low mileage low age vehicles that have been detailed, those signs of abuse don't show on the lot, to the average used car buyer. As long as the CarFax is clean, that is even a plus for the sale. Then to top it off, they throw in a CPO designation, to lure the unsuspecting buyer.
> 4) Most cars on used cars are bought at auction, w/o any inspection. Buyers naturally assume they are taken in trade.


----------



## 1968BMW2800 (Aug 13, 2016)

Glaird said:


> I'm developing a sense of this whole CPO marketing thing, regardless of makes, over the last few years. Caveat, I have little faith in companies, commission based employees of said companies, and now previous owners of cars.
> We are now the owner of 2 brand new BMWs, that took us years to get to the point of purchase. We started looking at reasonably depreciated used cars, mostly off of lease, that appeared to be low mileage bargains. As time wore on, each potential purchase reveal extra ordinary faults, I began to suspect the process was flawed. Then I joined this forum and gathered a sense of collective experiences from CPO purchases. My summation of suspicions below:
> 
> 1) Most people, even well intentioned car owners, treat their cars like disposable trash. They neglect basic inspection/maintenance. They used them for destruction derbies.
> ...


Not sure where you're getting the data regarding "most people."

The other day, as I was cleaning the engine compartment on my leased car, I did chuckle to myself, asking why I bothered -- after all mine is a _leased_ car...

Turns out, for _some_ of us enthusiasts, respecting our cars is part of the joy. I would add that when I'm test driving cars, the thought is in the back of my mind that if not me, someone is going to buy the car, so I try to drive it with that in mind. Just hoping to pass the good karma along, hoping it will come back around to me, which, thus far in my long life, it has.

I would also add that I have had an excellent experience with a gently used CPO purchase. While it is true, an abused car may not reveal how many times it has felt the spurs or enjoyed an aggressive track day, overall, the low-mileage, super clean "cream puff" cars are generally easy to spot. And, if the price is aggressively negotiated, there is value to be found.

To the larger point, I think it is fair to say that a used car is just that; _a used car._ As Mr. Brown so often reminds us, Buyer Beware.

But a CPO, from a stand up BMW Center, at the right price, sold and delivered by the right people who will do all they can to correct any legitimate post-delivery issues, can be about as close to stealing a good Bimmer as we law-abiding citizens will ever get. IMHO


----------

